Baoxin Software (600845) Company Research: High Deterministic Growth of Steel Information and IDC Two-Wheel Drive
From the Baosteel system, the development of information and IDC two-wheel drive companies.
The company was formerly a wholly-owned subsidiary formed by the integration of information industry-related assets within Baosteel Group. It has been undertaking the task of providing enterprise informationization to the original Baosteel Group and its related parties. It has developed with Baosteel Group for more than 40 years and promoted domestic steelDevelopment of informatization and industrialization.
Since 2015, the company has used Baosteel’s land, water and electricity resources to vigorously develop the IDC business, and the two-wheel drive company has developed rapidly.
First-tier cities are facing the status quo of IDC resource funding.
From the demand side, benefiting from the explosive growth of the amount of information and data, industries such as big data and cloud computing continue to be recognized by enterprises and users, resulting in increasing demand for IDC infrastructure by IT companies, Internet companies, and telecommunications operators.
From the perspective of the supply side, the barriers to IDC construction are high: 1) IDC’s pre-construction costs are high and the company’s capital needs are large; 2) Only locations with strong winds and water are conducive to natural cooling; 3) Industrial land and electricity indicators in first-tier cities areScarce resources; 4) Professional-grade IDC services have technical advantages only to have an advantage.
Baoxin software occupies scarce resources in Shanghai and naturally has IDC construction advantages.
Relying on the resources of Baowu Group Iron and Steel Plant, Baoxin has a natural industrial resource competitive advantage in Shanghai.
The Shanghai regional market has always been an important node in the deployment of national data centers for large customers. At the current stage of the Internet, financial enterprise customer demand is continuously released, and resource demand continues to expand.
The Baoxin Group relies on the shareholder Fangbaowu Group to resolve key constraints such as land, water, and electricity for the construction of IDC computer rooms.
At present, the number of cabinets in Shanghai Phase 4 exceeds 2.
70,000, at the same time the IDC model is also copied to Wuhan and other places.
The tide of M & A and reorganization in the steel industry has brought a lot of information construction needs.
First, since the second half of 2016, through the continuous advancement of internal supply-side reforms, steel prices have risen significantly, resulting in an improvement in the operating performance of steel companies in 2017, and the ability of the information-based demand-side steel mills to pay more.Encourage the support of M & A and reorganization of iron and steel enterprises, Baosteel’s merger and reorganization of Wuhan Iron and Steel, Maanshan Iron and Steel brings 西安耍耍网 a lot of information transformation needs; third, outside the Baowu system, the company signed a contract with Shougang and other steel plants, won the bid in 20172.
The 700 million project demonstrates Baoxin’s leading position in steel informatization.
Covered for the first time and given a “Buy” rating.
It is estimated that Baoxin Software’s attributable net profit for 2019-2021 will be 8 respectively.
8.7 billion, 11.
8.9 billion, 13.
3 billion, CAGR is 25.
Considering the overall high prosperity of the industry and the high growth of the company’s main business informatization and IDC business, the target price for 2020 is 40.
07 yuan (corresponding to the company’s 38 times PE in 2020), the first coverage, given a “buy” rating.
Risk warning: IDC demand risk, Wuhan IDC construction progress is less than expected, steel and other downstream industries informatization demand risk, greatly affected by the operating conditions of Baowu Group.