SEHK:107

Stock Analysis Report

Executive Summary

Sichuan Expressway Company Limited, together with its subsidiaries, invests in, constructs, operates, and manages expressway infrastructure projects in Sichuan Province, the People’s Republic of China.

Rewards

PE ratio (6.1x) is below the Hong Kong market (10.5x)

Earnings grew by 27.6% over the past year

Risk Analysis

Earnings have declined by -2.53% per year over past 5 years

Debt is not well covered by operating cash flow

Unstable dividend track record



Snowflake Analysis

Proven track record and fair value.

Share Price & News

How has Sichuan Expressway's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 107 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.7%

107

-3.7%

HK Infrastructure

-3.4%

HK Market


1 Year Return

-7.5%

107

-4.9%

HK Infrastructure

-0.4%

HK Market

Return vs Industry: 107 underperformed the Hong Kong Infrastructure industry which returned -0.1% over the past year.

Return vs Market: 107 underperformed the Hong Kong Market which returned 6.4% over the past year.


Shareholder returns

107IndustryMarket
7 Day-1.7%-3.7%-3.4%
30 Day-2.5%-2.7%-1.2%
90 Day1.7%1.8%3.7%
1 Year-3.1%-7.5%0.6%-4.9%3.3%-0.4%
3 Year-10.2%-21.3%6.2%-7.7%20.4%8.2%
5 Year-12.0%-27.4%3.9%-17.5%19.6%-0.4%

Price Volatility Vs. Market

How volatile is Sichuan Expressway's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sichuan Expressway undervalued compared to its fair value and its price relative to the market?

6.03x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 107 (HK$2.39) is trading above our estimate of fair value (HK$2.35)

Significantly Below Fair Value: 107 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 107 is good value based on its PE Ratio (6.1x) compared to the Infrastructure industry average (8.5x).

PE vs Market: 107 is good value based on its PE Ratio (6.1x) compared to the Hong Kong market (10.5x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 107's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 107 is good value based on its PB Ratio (0.4x) compared to the HK Infrastructure industry average (0.7x).


Next Steps

Future Growth

How is Sichuan Expressway forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

1.5%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if 107's forecast earnings growth is above the savings rate (1.6%).

Earnings vs Market: Insufficient data to determine if 107's earnings are forecast to grow faster than the Hong Kong market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 107's revenue (1.5% per year) is forecast to grow slower than the Hong Kong market (10.2% per year).

High Growth Revenue: 107's revenue (1.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 107's Return on Equity is forecast to be low in 3 years time (6.4%).


Next Steps

Past Performance

How has Sichuan Expressway performed over the past 5 years?

-2.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 107 has high quality earnings.

Growing Profit Margin: 107's current net profit margins (16.7%) are higher than last year (16.6%).


Past Earnings Growth Analysis

Earnings Trend: 107's earnings have declined by -2.5% per year over the past 5 years.

Accelerating Growth: 107's earnings growth over the past year (27.6%) exceeds its 5-year average (-2.5% per year).

Earnings vs Industry: 107 earnings growth over the past year (27.6%) exceeded the Infrastructure industry 1.1%.


Return on Equity

High ROE: 107's Return on Equity (6.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Sichuan Expressway's financial position?


Financial Position Analysis

Short Term Liabilities: 107's short term assets (CN¥8.6B) exceed its short term liabilities (CN¥5.0B).

Long Term Liabilities: 107's short term assets (CN¥8.6B) do not cover its long term liabilities (CN¥16.4B).


Debt to Equity History and Analysis

Debt Level: 107's debt to equity ratio (104.8%) is considered high.

Reducing Debt: 107's debt to equity ratio has reduced from 105.8% to 104.8% over the past 5 years.

Debt Coverage: 107's debt is not well covered by operating cash flow (12.9%).

Interest Coverage: 107's interest payments on its debt are well covered by EBIT (3.2x coverage).


Balance Sheet

Inventory Level: 107 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 107's debt is not covered by short term assets (assets are 0.5x debt).


Next Steps

Dividend

What is Sichuan Expressway's current dividend yield, its reliability and sustainability?

4.81%

Current Dividend Yield


Dividend Yield vs Market

company4.8%marketbottom25%2.2%markettop25%6.2%industryaverage5.3%forecastin3Years6.0%

Current dividend yield vs market & industry

Notable Dividend: 107's dividend (4.72%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.17%).

High Dividend: 107's dividend (4.72%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.02%).


Stability and Growth of Payments

Stable Dividend: 107's dividend payments have been volatile in the past 10 years.

Growing Dividend: 107's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (29%), 107's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 107's dividends in 3 years are forecast to be well covered by earnings (35.4% payout ratio).


Next Steps

Management

What is the CEO of Sichuan Expressway's salary, the management and board of directors tenure and is there insider trading?

7.2yrs

Average management tenure


CEO

Yongyi Gan (56yo)

7.2yrs

Tenure

CN¥537,000

Compensation

Mr. Yongyi Gan has been General Manager of Sichuan Expressway Company Limited since November 16, 2012 and serves as its Chairman of the Board since January 17, 2020. Mr. Gan served as a Deputy General Mana ...


CEO Compensation Analysis

Compensation vs Market: Yongyi's total compensation ($USD77.94K) is below average for companies of similar size in the Hong Kong market ($USD547.75K).

Compensation vs Earnings: Yongyi's compensation has increased by more than 20% in the past year.


Management Age and Tenure

7.2yrs

Average Tenure

54yo

Average Age

Experienced Management: 107's management team is seasoned and experienced (7.2 years average tenure).


Board Age and Tenure

0.4yrs

Average Tenure

54.5yo

Average Age

Experienced Board: 107's board of directors are not considered experienced ( 0.6 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyHK$1,381,64418 Sep 19
China Merchants Group Limited
EntityCompany
Shares594,000
Max PriceHK$2.33
BuyHK$590,40010 Jul 19
China Merchants Group Limited
EntityCompany
Shares246,000
Max PriceHK$2.40

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Yongyi Gan (56yo)

    Chairman & GM

    • Tenure: 7.2yrs
    • Compensation: CN¥537.00k
  • Yongnian Zhang (56yo)

    Secretary to the Board

    • Tenure: 22.4yrs
  • Maoquan Luo (54yo)

    Deputy GM & Executive Director

    • Tenure: 3.5yrs
    • Compensation: CN¥438.00k
  • Junjie Liu (55yo)

    Deputy General Manager

    • Tenure: 10.9yrs
  • Zhuqing He (43yo)

    Deputy GM & Executive Director

    • Tenure: 0.6yrs
    • Compensation: CN¥329.00k
  • Yi Tian (51yo)

    Secretary of Discipline Inspection Commission

    • Tenure: 4.8yrs
    • Compensation: CN¥348.00k
  • Guo Renrong (46yo)

    CFO & Financial Controller

    • Tenure: 2.3yrs
  • Layi Heibi

    Deputy General Manager

    • Tenure: 0.3yrs

Board Members

  • Yongyi Gan (56yo)

    Chairman & GM

    • Tenure: 7.2yrs
    • Compensation: CN¥537.00k
  • Bing Feng (56yo)

    Chairman of the Supervisory Committee

    • Tenure: 6.8yrs
    • Compensation: CN¥446.00k
  • Maoquan Luo (54yo)

    Deputy GM & Executive Director

    • Tenure: 3.5yrs
    • Compensation: CN¥438.00k
  • Zhuqing He (43yo)

    Deputy GM & Executive Director

    • Tenure: 0.6yrs
    • Compensation: CN¥329.00k
  • Shilin Ni (52yo)

    Vice Chairman

    • Wenhu Li (42yo)

      Non-Executive Director

      • Tenure: 0.2yrs
      • Compensation: CN¥348.00k
    • Lina Liu (61yo)

      Independent Non-Executive Director

      • Tenure: 3.5yrs
      • Compensation: CN¥80.00k
    • Zhiming You

      Non-Executive Director

      • Tenure: 0.2yrs
    • Jinkang Gao (55yo)

      Independent Non-Executive Director

      • Tenure: 0.2yrs
    • Danlu Bu

      Independent Non-Executive Director

      • Tenure: 0.2yrs

    Company Information

    Sichuan Expressway Company Limited's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Sichuan Expressway Company Limited
    • Ticker: 107
    • Exchange: SEHK
    • Founded: 1997
    • Industry: Highways and Railtracks
    • Sector: Transportation
    • Market Cap: HK$11.469b
    • Shares outstanding: 3.06b
    • Website: https://www.cygs.com

    Number of Employees


    Location

    • Sichuan Expressway Company Limited
    • 252 Wuhouci Da Jie
    • Chengdu
    • Sichuan Province
    • 610041
    • China

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    SEXH.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDOct 1997
    107SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDOct 1997
    EXF1DB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEUROct 1997
    107SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDOct 1997
    107SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDOct 1997
    601107SHSE (Shanghai Stock Exchange)Domestic SharesCNCNYJul 2009
    601107XSSC (Shanghai Stock Exchange - Shanghai - Hong Kong Stock Connect)Domestic SharesCNCNYJul 2009

    Biography

    Sichuan Expressway Company Limited, together with its subsidiaries, invests in, constructs, operates, and manages expressway infrastructure projects in Sichuan Province, the People’s Republic of China. It operates through five segments: Toll Operation, Construction Contracts, Sale of Products, Property Development, and Others. The Toll Operation segment engages in the operation of expressways and a high-grade toll bridge in Mainland China. The Construction Contracts segment provides construction and upgradation services under the service concession arrangements and construction contracts. The Sale of Products segment is involved in the operation of gas stations along expressways; and the sale of petrochemicals and other oil products. The Property Development segment invests in and develops properties in Mainland China. The Others segment engages in the advertising and finance leasing operations, as well as rents properties along expressways. The company was incorporated in 1997 and is based in Chengdu, the People’s Republic of China. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/28 12:35
    End of Day Share Price2020/01/24 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.