In 2008, the company reported total business turnover of Rmb1467mn (+23.6% yoy), operating profit of Rmb369mn (+48.6% yoy), net profit attributable to owners of parent of Rmb304mn (+75.1% yoy), and diluted EPS of Rmb0.52. The company’s dividend distribution plan was to send pretax cash dividend of Rmb2 plus 5 additional shares for every ten shares.
2009-2010E EPS is predicted to be Rmb0.00 and Rmb0.01; given its low absolute value of performance, PB estimation is rather reasonable. Present PB is at 2.4x, which is above those of key listed enterprises within the sector. “Neutral” rating is hereby maintained. Besides, given its high dividend cash distribution plan proposed in 2008 annual report, and that its share price tends to be optimistic recently (approaching 2008 additional-issuance price of Rmb9), follow-up price might face heavy pressure to sell, thus investors are suggested to sell at a high price.
Potential risks: COA contract freight charge decline; unexpected oil price surge in 2H2009.