In Youngor'S System, Clothing Has Become A "Vase".

The intensive reduction of Bank of Ningbo's huge cash out opened the prelude of Youngor's large-scale realization of investment returns.

Bank of Ningbo, Midea real estate, CITIC, as well as Jintian copper, boqian new material, Shengtai group, which are listed and passed the meeting this year, will continue to lengthen the shareholding list of Youngor.

The investment business brings huge profits to the company, while the real estate business contributes a lot to the growth of the company's scale in the bottleneck period of the main business. In the first half of the year, it has increased sharply against the trend and become the pillar of the company's performance.

At present, Youngor men's clothing business is only Youngor's "face", while "Lizi" is a real estate business that contributes revenue and realizes profits.

However, Youngor, which has been established for 40 years, is gradually abandoning its "troika" strategy and refocusing on the main clothing industry. The investment business will no longer continue to invest, and the real estate business has not independently acquired land since last year, and is also ready to transform into a property operator.

Is Youngor ready for the pain of transformation?

investment

Recently, Youngor (600177. SH) disclosed that during the period from September 15 to October 15, the company sold 44284700 shares of Bank of Ningbo (002142. SZ), with a transaction amount of 1.483 billion yuan and an unaudited profit of 423 million yuan.

Since August 3 this year, the company has reduced the shares of Bank of Ningbo. As of October 15, it has sold 236 million shares of Bank of Ningbo, cashed in RMB 7.861 billion, and the net profit without audit has reached RMB 2.223 billion, which is close to the company's annual performance in 2019.

After this round of reduction, Youngor is still the third largest shareholder of Ningbo bank, holding 560 million shares, accounting for 9.33% of its total share capital. The latest market value is close to 20 billion yuan.

In fact, Ningbo bank is only one of the typical representatives of Youngor's investment business. By the end of June 2020, the company has invested more than 30 projects, with an accumulated investment amount of 32.056 billion yuan and a market value of 33.247 billion yuan.

Among them, the listed projects include bank of Ningbo with a shares, Lianchuang electronics, venture Huikang, CITIC shares of Hong Kong stock, Midea real estate, etc.

This year, Youngor's investment projects have entered a bumper harvest period. Jintian copper and boqian new materials have been listed successively. Shengtai group is also waiting for IPO.

It is worth mentioning that Shengtai group was originally a garment OEM factory hatched by Youngor. After independence, Shengtai group obtained investment from Nippon textile and Itochu, and is expected to become a garment OEM enterprise with a share of ×.

In addition, the target of Youngor's investment is planned to go public, including PetroChina Pipeline, UnionPay commerce, China International Union, etc.

real estate

If the investment business brings huge profits to the company, it is the real estate business that has sustained the scale of the company for a long time.

In the early years, leading enterprises from all over the country entered the real estate business, which led to the birth of Gree real estate, Midea real estate and Suning real estate. In the textile and clothing field where Youngor is located, Hongdou shares, Hailan home, etc. are also second to none in the regional real estate market.

Youngor real estate is the first one among local real estate developers in Ningbo. In recent years, Yinyi real estate has gradually declined due to the influence of Yinyi holding, and the company has almost become the only seedling among local developers.

In most years since Youngor went public, the scale of real estate business far exceeds that of clothing business and becomes the mainstay of the company's business income.

In the first half of 2020, affected by the epidemic situation, the clothing business of the company was under pressure, while the real estate business was particularly excellent: the real estate sector achieved an operating revenue of 4.329 billion yuan and a net profit of 1.178 billion yuan, respectively, up 203.57% and 329.56% compared with the same period of last year.

Driven by the real estate business and other factors, in the first half of this year, the company's operating revenue and net profit attributable to the parent company were 6.958 billion yuan and 2.876 billion yuan, respectively, up 51.83% and 41.88% year-on-year. Whether in the real estate sector or clothing sector, it can be described as a unique branch.

Then someone has to ask, most Chinese consumers know Youngor because of its clothing business. So, where has its clothing sector gone?

clothing

In the early 1980s, Li Rucheng started from a small workshop that lived in the basement of the stage, and has developed into a Chinese costume. The story of Youngor has been circulating in the world for many years.

Today's Youngor clothing is characterized by hemp. Its brands include Youngor, Hart Schaffner Marx, mayor, hANP, Youngor lady, etc., including men's wear, outdoor, home textiles, women's wear and other categories.

Although Youngor's clothing business, especially men's clothing, has always been in the first echelon of China's clothing industry, it has been in a bottleneck.

In 2009, the company's clothing business revenue was 5.527 billion yuan; in 2019, the operating income of the board was 5.598 billion yuan. In 20 years, China's clothing industry has iterated several times, and Youngor is still in the same place.

In the first half of this year, affected by the epidemic, the clothing industry ushered in the most difficult moment, and Youngor was no exception. As of the end of June 2020, the company has 2372 outlets of various types, a net decrease of 66 compared with the beginning of the year, with a business area of 471000 square meters.

The company took micro distribution, live broadcast and other forms of delivery, still failed to stop the decline in performance. From January to June, the clothing sector achieved 2.629 billion yuan of operating revenue and 395 million yuan of net profit attributable to the parent company, which decreased by 16.72% and 39.03% respectively compared with the same period of last year.

Whether it is the previous standing still or this year's performance decline, it can only show that at this stage, in the whole Youngor system, the importance of clothing business is getting lower and lower, and it has become a complete "vase".

regression

This "embarrassing" situation should not last long.

In 2019, on the occasion of the 40th anniversary of the founding of the brand, Youngor made it clear that in the future, in addition to strategic investment and continuing to fulfill investment commitments, the company will no longer carry out financial equity investment in non main business areas, and choose the opportunity to dispose of existing financial equity investment projects.

The planning of the real estate business is similar. Starting from 2019, Youngor real estate mainly increases project reserves through cooperation, "while maintaining the benign development of existing development business, it also opens the transformation exploration of emerging related industries such as culture, tourism, health preservation, pension, health town and so on."

After all, the real estate market is not easy to do, especially for regional enterprises like Youngor real estate. Data show that in the first half of this year, the turnover of commercial residential buildings in five districts of Ningbo dropped by 10%, and the turnover of residential land decreased by 10%.

Reduce the importance of investment and real estate business, the company made clear the core position of brand clothing industry. Youngor realized that only starting business clothing is the foundation of the group.

But is Youngor ready to go downhill? Once the total business size of the real estate company can not break through the bottleneck of its long-term investment, can it make a breakthrough in its profitability?

A few years ago, the company has been profitable, dividend is not soft. From 2017 to 2019, the company's cash dividends amounted to 1.433 billion yuan, 1.791 billion yuan and 2.409 billion yuan, respectively accounting for 482.79%, 48.70% and 60.64% of the net profit attributable to the parent in that year. After returning to the clothing industry, at least such days will be gone forever.

Kunlun trust, the second shareholder of Youngor, has reduced the company's shares substantially in the second half of 2019. Since the second half of this year, Kunlun trust has recently reduced its holdings of 18.02 million shares at a discount, and realized more than 100 million yuan.

In order to maintain the share price, the company invested 1.017 billion yuan in the first half of this year to buy back 153 million shares of the company. From June last year to the end of June this year, the company spent 2.5 billion yuan to buy back 385 million shares of the company, which has been cancelled. A new round of repo is on the way.

Even so, the company's share price remains low, with a P / E ratio of 6.84 times, far below the average p / E ratio of the Shanghai Composite Index. On October 19, the company's market value was only 32.959 billion yuan, less than the value of its investment shares.