SF Holdings (002352): Refueling on the road

SF Holdings (002352): Refueling on the road
The leading domestic express logistics integrated service provider.SF Express was established in Shunde, Guangdong in 1993, changed from franchise system to direct operation in 2002, and established a group headquarters in Shenzhen. In 2009, it purchased all cargo aircraft and established its own aviation.In recent years, SF has transformed from express delivery to comprehensive logistics, and has actively expanded the business of express, cold chain, same city, international, and supply chain.In the first half of 2019, it achieved operating income of 500.75 ppm, a ten-year increase of 17.68%, net profit attributed to mother 31.10,000 yuan, an increase of 40 in ten years.35%. High-quality services, brand premiums foster competitive barriers.SF is positioned in the mid-to-high-end express market. Customers are less sensitive to price, but have higher requirements on timeliness, security, and service.We think 1) SF’s direct sales model 南京桑拿网 helps to ensure service quality and timeliness, and ensure customer experience and perception.2) The advantages of the SF fleet ensure the timeliness of long-distance transportation of more than 1,000 kilometers. After deployment and use at Ezhou Airport, it will effectively reduce the unit cost of freight and make the advantages of long-distance express more obvious.3) SF service outlets cover the whole country and overseas, and jointly develop railway transportation products such as high-speed rail express and e-commerce trains with China Railway to maintain timeliness and cost advantages over short and medium distances. The benefits of new economic products are outstanding, and cost control is remarkable.1) The growth rate of aging parts 19Q2 gradually climbed, and economic products launched new products such as special offers, mainly aimed at the fast-growing e-commerce component market. After the product launch, the growth rate was rapid, driving the economic product revenue scale and market share to accelerate.2) SF continues to increase its investment in science and technology, with R & D investment in the first half of 201912.10,000 yuan, an increase of 56 in ten years.31%, using big data and cloud computing technology to carry out cost control in transportation, transit, packaging, warehousing, etc., especially in transportation conversion, by establishing a car-cargo matching platform to realize transparent transportation prices along with products, and optimize routing with big dataDesigned to improve the loading rate of transportation, the cost of transportation capacity as a percentage of revenue will decrease by 1 in 2019H1.In 98 samples, the results of cost reduction and efficiency improvement appeared, and gross profit margin continued to increase.3) Due to the continued expenditure of new business, the 18-year performance was under pressure, the rapid development of new business was transformed, and profits gradually improved under the effect of scale. Looking at the diversified layout in the long run opens up development space.Looking back at the development history of UPS, its continuous expansion of its business areas has led to long-term revenue growth.SF Holdings has transitioned from a courier brand to an integrated logistics provider, and actively expands heavy cargo, cold chain, same-city, and supply chain businesses other than courier. The market space has expanded from 600 billion to 600 billion.Double the growth space.In 2018, UPS’s international packaging accounted for about 20%, and supply chain and freight accounted for about 20%. Compared with SF’s share of international parts and supply chain and freight, there is still a reduction, and there is still room for improvement in the future. Investment strategy: We predict that the company’s net profit attributable to its mother in 2019-2021 will be 58.1.4 billion, 68.7.2 billion, 79.60,000 yuan, an increase of 27 in ten years.6%, 18.2%, 15.8%.SF is a leader in comprehensive logistics, and it has given a certain estimated premium. We give the company a target price of 46 in 2020.8 yuan, corresponding to 30 times the PE, for the first time coverage, assigned a “buy” rating. Risk reminders: Macroeconomic fluctuation risks; increased market competition risks; fuel price fluctuation risks; and the risk of increasing human costs.