Category: Money tips Release Date: 2006-06-20
Recently, we conducted a more in-depth communication Borui tracking research, and on existing business development and Chengdu Media Group, after the establishment of strategy development and corporate executives to the communication. According to research, examining the situation, we initially formed the view the following aspects:
1. Chengdu Media Group set up to completely open the bottleneck with the development resources Borui November 18, 2006, Chengdu Media Group (hereinafter referred to as "Media Group"), the formal establishment of the original Chengdu Daily Newspaper Group (hereinafter referred to as "Press Group"), and Chengdu Radio and Television (hereinafter referred to as "SVA") merged. Despite the Newspaper Group and SVA Group merger has been practiced in China, such as the Mudanjiang Media Group, Foshan and media group and so on, but in the capital city of such an administrative level, the establishment of an integrated media group in China, or the first case has fully revealed the city of Chengdu City Government to deepen cultural restructuring, the Chengdu media industry bigger and stronger decisions and confidence. As the Newspaper Group and SVA Group merger of the assets and operations by the media group "inheritance", Fabory Group became the media group controlled by a direct subsidiary of Fabory communication has thus become the media group controlled by listed companies. Moreover, we learned from the side, the relevant documents in the media group, also formally confirmed Borui spread as the only listing and financing platform for the Group, the Group's media resources are combing through the rational and integrated, will be market-oriented approach , select the appropriate time to enter the listed companies.
Recalling the "Chengdu Business Daily" the development process, we can see that in 2002, before integration into the newspaper group, "Chengdu Business Daily" in full accordance with the law of the market from scratch, constant growth and expansion; while Bory communication as the first shell of domestic enterprises listed on the press, in the continuation of "Business News" all operating businesses at the same time, but also transmission of the market-oriented business philosophy and positive and effective management style, Fabory the past few years has thus been a significant progress. However, we are delighted that the newspaper business in the fast-growing should also be noted that, with the television media is growing stronger and the rapid rise of new forms of media, newspapers print media is facing unprecedented challenges, despite operating in all Fabory Item newspaper business continued to achieve good development, but the media reported that the overall begun to enter the mature stage is an indisputable fact that the future development of space is obviously limited, the media resource development bottlenecks have been gradually revealed. However, the establishment of the Media Group as well as the Borui only the status of capital markets platform, the establishment of, no doubt greatly expand the company's future long-term development.
We believe that the establishment of the Chengdu Media Group communication had completely broken Borui media development of major industries in the process of facing the resource bottleneck. In our view, this long-term development of the open space is not only reflected in the company may be the case the time is ripe to integrate the market is still in the early development of radio and television assets and operations; more importantly, the merged media group, whether the media influence, or asset size, and the original daily compared with groups or SVA Group, has not in the same breath, under the existing system and the practical conditions, the Chengdu Municipal Government is bound to culture and the media resources to tilt further to the media group, The market has a strong operational experience and management capabilities and capital markets platform Bory will play a crucial role in which the. However, we must point out that, owing to the newly established media group, business organization and management team has just completed restructuring, the Group's development strategy should be placed at carding, perfect stage, not yet made the final decision-making, radio and television assets needed in the in vitro completion of integration. Therefore, we judge Borui real start of the media group communication assets, the business may be integrated into the mid-year or so at least, premature, excessive speculation on the company's stock may adversely affect the operation of the capital.
2. Print media operating businesses integrate gradually into the "wrap up" phase after the merger of the media group is a larger platform to consider the development of Chengdu culture, media industry, based on Borui disseminate existing good basis for a newspaper business to accelerate the completion of Borui right Newspaper Group operating print media business integration has become a matter of course matter.
Printing business: After years of construction and development, Bory's Printing Company has grown into the most advanced equipment, southwestern region, production capacity, one of the largest newspaper printing enterprises, while the newspaper group still retains a major commitment, "Daily", "Evening News" printing the work of printing due to lack of capital investment is no longer competent newspaper business development needs (such as color printing capability). We expect that Borui Printing is likely to be completed early this year on the Group's printing press to the acquisition of assets and businesses. By then, through the reasonable deployment of the existing printing capacity and operating efficiency improvements, only the acquisition of the printing business contributions to net profit nearly 1,000 million, the words "Handelsblatt" and receiving foreign newspaper printing operations, as well as the natural growth in business India positive on the market expansion in 2007 will be the Borui printing business to achieve substantial growth year.
Issue Delivery: In the delayed one year after the "Chengdu Evening News," The delivery business was finally released in 2007 by the Laborie exclusive agent. "Evening News" is a still in the growth stage of the market report, with the success of the 2006 revision (content closer to the life of the people), advertising and circulation showing a clear upward trend (which we passed early morning field visits to several newsstand , every newsstand, "Evening News", the average volume of retail sales in the 50 or so, in individual kiosks or even more than "Handelsblatt" in volume of retail sales). As the "Evening News" is a market report (as distinct from a party newspaper the "Daily"), decentralized delivery, and the need Laborie grew assume the responsibility of facilitating the issue, therefore, delivery rates are relatively high, is expected to account for newspaper article income about 60%. According to "Evening News" a million copies of the daily average of 16 current circulation is estimated that in 2007 the exclusive agent "Evening News" Release Delivery will add 11 million yuan of income, but due to the undertaking, "Evening News" original 800 of the delivery team, the short-term cost face upward pressure, this year's profit contribution may be relatively limited. However, in the long term, to hold "Evening News" delivery business, the acquisition of its channels for staff, help to strengthen Bory in Chengdu monopoly of newspaper distribution channels for delivery to avoid the intrusion of competition within the system rolling. We believe that as companies sort out the completion of the channel and additional services (such as delivery of goods, DM single) the conduct and distribution channels to deliver value to the business will be further reflected.
In addition, given the current newspaper management system (pipeline does not allow business), and the company's operating business model newspapers, we believe that Borui should not strive to take into account, "Handelsblatt", "Evening News" exclusive advertising agency rights, but will maintain the status quo, maintaining Bory and newspaper inter-group "relative balance."
3. The rapid development of advertising, outdoor advertising will become the biggest bright spot in 2004, along with the Laborie control of the media resource capacity, advertising and gradually showing a rapid development trend. Following the amount of advertising agency in 2005 to achieve 230 million yuan, we expect the amount of advertising agency in 2006 the company is likely to reach 3 billion yuan and revenue nearly 1 billion yuan and net profit of about 4200 ~ 45 million yuan. The reason, in addition to "Handelsblatt" Overall achieve rapid growth, market share gains and reflect the effect of integration of media resources to promote its rapid development into a major driving force.
In April 2006 and June, the company purchased through auction, respectively, and Guanghua Road, Chengdu city (Chengdu - Wenjiang) 618 Lu poles three-year advertising rights, the end of Youyi 34.5 million yuan of the purchase price of the acquisition of Sichuan extraordinary Cultural Advertising Communications Limited and the assets and operations into the south has a high-speed (Chengdu - Nanchong) and Chengdu Ring the exclusive right to operate high-speed media, business prospects are bright. City Road, poles advertising has progressed, however, made high-speed link the South's "by Ning - Chongqing high-speed" and "Nanchong - Chongqing high-speed" will be opened to traffic before and after the end of 07 Since then, the Chengdu-Chongqing, Chengdu-Chongqing high-speed ride compared to shorten the 1 hour, traffic flow is expected to significantly increased, making the value of outdoor media, will be increased dramatically. Moreover, with the Chengdu city government within the outdoor advertising regulation, Bory is expected to be outdoors in the city core areas big, big business within the city limits due to higher-value, the company will get a higher profit from this. We conservatively estimate that outdoor advertising will bring the company a profit of more than 10 million contribution.
4. Raised profit forecasts and investment ratings on the company's operating condition, we at the beginning of 2006 to determine the trend of earnings Bory is a basic right. According to the research as well as possible for the 2007 refinancing, we carefully lowered 2006 earnings per share forecast to 0.53 yuan, a single increase 07 ~ 2008 earnings per share were forecast to 0.75 yuan and 0.93 yuan, to maintain "the most U -1 "investment rating, 6-month target price raised to 30 yuan.
