Tianmu Lake (603136): Prospects from “Small and Beautiful”

The core point of view is that the small and beautiful scarce private-run scenic spots have excellent management capabilities.

Relying on two major reservoirs, after more than ten years of meticulous development, the company focuses on one-stop services of nature + leisure tourism, successfully creating three core attractions with 300 million revenues and continued growth (Shanshui Garden, Nanshan 苏州桑拿网 Bamboo Sea, YushuiHot spring), rich product portfolio, high brand recognition, highlighting the company’s good business capabilities and market demand capture capabilities.

Although the company’s revenue volume is medium among the 10 listed companies in natural attractions, the net interest rate is 24.

7%, ranked second among companies of the same size, with many prominent.

The company’s core executives share equity constraints and provide sufficient incentives, which are small and beautiful private private equity.

The core point: the rise in volume and price brings continuous long-term kinetic energy.

We believe that there is a clear growth logic in Tianmu Lake Scenic Area: 1) The company’s customer unit price will be significantly increased by creating boutique tourism routes + high-end consumer projects; the company’s Shanshui Garden, Nanshan Bamboo Sea, Yushui Hot Spring and Water WorldThe proportion of non-ticket revenue was 44.

3% / 76.

8% / 56.

2% / 26.

7%, ticket dependence is low, and passenger unit prices have increased.

The one-stop travel service announced by the company strives to create high-quality tourist routes, realize the introduction of passenger flow between various attractions, extend the playing time of tourists, deeply explore the potential of single consumption, and increase per capita consumption.

In addition, the company is constructing the high-end consumer project Yushui Hot Spring Phase II to cover the travel needs of high-end consumers in the Yangtze River Delta.

After the hotel is completed, the company can introduce these high-end consumers into other core attractions through product mix and other methods, bringing a double increase in unit price and passenger flow.

2) Except, the company has been engaged in the convenience of transportation and the extensive leisure travel market in the Yangtze River Delta. The company has a deep base of tourists and is committed to driving the growth of the company’s medium- and long-term passenger traffic: the demand for leisure travel in the Yangtze River Delta is strong and Tianmu Lake is at the coreIn the city’s 3h tourism metropolitan area, the source of tourists is deep, the influence of the company’s brand is expanding, and the medium- and long-term passenger flow of its tourism assets continues to increase.

Internal company’s estimated space: strong reproducibility + management output, it is estimated that the improvement space is large.

ROE = ROI * PB. With the full flow of market investment and the replacement of ROI convergence, companies with profitability (ROE) conversion should also replace the corresponding estimates.

We believe that the company’s development model is aimed at reducing scarce natural resources and is highly reproducible. In the future, it is expected to realize asset-light operation and improve profitability by managing output.

The company’s average ROE for 13-17 years reached 19.

9%, ranking first among all listed attractions. It is expected to enjoy a higher level of estimation and greater room for improvement in the future.

Financial forecasts and investment recommendations are given a BUY rating for the first time with a target price of 46.

19 yuan.

We expect the company’s EPS to be 1 in 19-21.

49/1.

71/1.

97 yuan.

Using the comparable company assessment method, the 19-year comparable company’s estimate was 31X, and the company’s 19-year PE estimate was 31X, corresponding to a target price of 46.

19 yuan, the first buy rating.

Risks suggest that ticket prices will drop, passenger traffic will grow less than expected, projects under construction will fall short of expectations, natural disasters at attractions, etc.