Gezhouba (600068): Orders exceeded targets to further strengthen performance. Northbound funds continued to increase positions.

Gezhouba (600068): Orders exceeded targets to further strengthen performance. Northbound funds continued to increase positions.
Summary of the report: (1) Recently, the company announced that the amount of new contracts signed in 2019 was 2520.2.8 billion, 108 for the annual plan.63%; (2) Since 2019Q4, Northbound Capital has gradually increased its holdings of nearly 42 million shares in the company.  The order exceeded the target amount by 9% and increased by 13% in ten years. The non-water conservancy / hydropower / overseas ratio exceeded 70% / 30%.  An initial new high of 252 billion was signed, and the growth rate has rebounded significantly, which is expected to drive a substantial increase in the income of the main construction industry.Judging that the order’s driving force mainly comes from domestic and downstream investment restoration and deepening overseas cooperation, and will continue to continue to benefit from macro countercyclical hedging and the company’s active overseas strategy.From a structural point of view, the order reflects the company’s diversified and internationalized construction business. The proportion of non-hydraulic and hydropower / overseas orders is 70% / 32%. From the perspective of major project models, the general contracting projects in the past two yearsThe proportion is high. The prudent development of PPP projects and the innovative “EPC + F” and “EPC + O” models deserve attention.  Optimistic about the company’s overall performance in the short-term growth and long-term upward trend.In 2018, the company’s main construction business income / gross ratio accounted for only 54% / 45%. Diversification has become more mature and the potential for long-term structural transformation.At present, in addition to the significant rebound in the main construction industry benefiting from domestic counter-cyclical hedging and the deepening of overseas cooperation, cement, civil explosion, real estate, basic investment and other businesses have also shown good development trends. Environmental protection and manufacturing businesses should focus on market potential and company layout.We are optimistic about the short-term growth of the overall performance and the upward trend in the medium and long term.  Undervalued blue-chip central-investment central enterprises, northbound funds continued to increase positions.The company’s current average level is at the bottom of history and the lowest position in the horizontal sector, while dividends are stable and the dividend yield level is at the forefront of the sector.Starting from the company’s business structure and construction order structure, we believe that the company is far more than just a hydraulic engineering company. The current market estimates that it is closer to the hydraulic engineering sector, or there is significant room for repair.The relative amount of Northbound funds to the company and the current position are slightly lower than the average level of the construction company. Since Q4, the company has gradually increased its holdings of nearly 42 million shares, and the proportion of its holdings in current A shares and free flowing shares is 1.87% / 3.25天津夜网%, gradually increasing holdings of approximately 3.21 million shares since 1 month, to a certain extent reflecting the market’s continued optimism about the company’s prospects; profit forecast and investment rating: the company’s gradual order exceeded the target and gradually enhanced performance, currently still in the bottom area and hasMargin of safety, better flexibility and diversified prospects, continue to pay attention to matters such as the company’s business layout, performance repair and debt-to-equity landing.It is expected that the company’s revenue for 2019-2021 will be 1150.900 million, 1270.880,000 yuan, 1396.4.9 billion, net profit attributable to mother is 54.8.5 billion, 71.5.1 billion, 77.02 trillion, the corresponding eps is 1.19 yuan, 1.55 yuan and 1.67 yuan.The current anniversary corresponds to a PE value of 5 in 2019-2021.6 times, 4.3 times and 4 times.Maintain the “Highly Recommended” rating.  Risk Warning: Overseas business risks, investment is less than expected risk, project landing is less than expected risk, financial risk.