Donggang Shares (002117): Donggang Ruiyun’s proposed shareholding system reform slightly sets the foundation for archival business development
[Event]Donggang Ruiyun, a subsidiary of Donggang Co., Ltd., plans to restructure the company and form a joint stock company.
The purpose of the shareholding system restructuring is: 1) when the separate listing conditions are met, apply for separate listing and financing on the share capital, and priority is given to applying for listing on the science and technology board; 2) through the shareholding system reform, to further improve the corporate governance structure.
[Comments]1) The shareholding reform will expand Donggang Ruiyun’s financing channels.
Donggang Ruiyun is mainly engaged in archival storage and electronic business. The shareholding system can be adjusted to take full advantage of new capital market policies. If the science and technology board is successfully listed, it will help expand Donggang Ruiyun’s financing channels 武汉夜网论坛 and provide financial support for the development and expansion of archives business.Donggang provides performance flexibility.
2) Donggang Ruiyun’s file storage business has developed rapidly.
Donggang’s file storage business customers continued to increase, with revenue growing by 67 per year in 18 years.
①In terms of industry, digital storage expansion of archives can reduce storage costs and risks, and improve accessibility (more than 85% of the world’s top 500 archives).
With the promotion of budget policies and the increase in customer expectations, the archive storage industry has a vast space and is still in the blue ocean.
② From the perspective of the company, Donggang Ruiyun, as a high-level enterprise, has fully benefited from industry dividends.
The company can extend the service chain of traditional printing customers, and can also use the accumulated credit of winning large projects to attract 西安耍耍网 new customers.
In addition, the company developed an archive cloud platform for small, medium and micro enterprises, and piloted it to more than 20,000 enterprises in the Beijing Development Zone.
③ On the profit side, through continuous expansion of the customer base, the company will increase capacity utilization (currently only 30%) and optimize costs.
3) Highlights in the future: ①Main business of printing: Benefit from customer expansion + product upgrades, the revenue side is expected to increase steadily, and some 18Q4 orders are postponed to be confirmed. It is expected that 19Q1 revenue will improve, and the profit side will benefit from the decline in previous paper prices.
② New business: Smart cards continue to be invested in the market on a large scale, and electronic bills are the general trend. Donggang Fatli Blockchain electronic bills are expected to achieve heavy volume of revenue, and the release of lottery sales terminals will accelerate.
Investment rating: We estimate Donggang’s net profit for 2019-2021 3.
990,000 yuan, corresponding to PE of 25.
The traditional main business is stable, new business contribution flexibility, dividend reorganization, shareholding system restructuring expectations boost estimates, and maintain a highly recommended level.
Risk warning: Bill printing industry shrinks sharply, new business launches fall short of expectations