Source | time Business School

Author | Chen Jiaxin

Editor | Zheng Shaona

Since the release of the bid-winning Huazhong Intelligent aircraft Industry Base project (Phase I) on April 17, the share price of Zhongheng Design has risen for five consecutive trading days.

As of April 23, Zhongheng Design shares closed at 11.Lures.29 yuan per share (former reinstatement right), with a total market capitalization of 3.115 billion yuan.

And the day before, Zhongheng DesignLuresAccording to the announcement, the company's revenue and deduction of non-net profit both declined in 2023 compared with the same period last year. Nevertheless, the poor performance did not stop its share price from rising again the next day.

On April 22, Zhongheng Design also released the "Stock Trading risk Alert" saying: "after the company's self-examination, the company's daily business activities are normal, the market environment and industry policies have not been significantly adjusted, and the internal production and operation order is normal." there are no major changes in the company's internal and external business environment. " However, the company did not mention the impact of the winning Huazhong smart aircraft industry base project (phase I).

The announcement shows that Zhongheng Design's main business is engineering design, project general contracting, project management and project supervision in the field of construction.

On April 23, time Business School called Zhongheng Design to inquire about the sharp rise in share prices and the reasons for the decline in revenue, but the other party could not be reached.

Won the bid for 2.6 billion yuan "low-level economic industrial demonstration zone" design project

On April 17, the official website of Zhongheng Design showed that Zhongheng Design successfully won the bid for Huazhong Intelligent aircraft Industry Base Project (Phase I).

According to the article, the industrial base is an important part of Wuhan Economic Development Zone to build a three-dimensional "low-level economic industrial demonstration zone" and focus on building a "3335" modern industrial system.

As a supporting infrastructure project, the Huazhong Intelligent aircraft Industry Base project has a total investment of more than 2.6 billion yuan. The project includes eight sub-projects, including the main body of intelligent aircraft and municipal roads, which will accelerate the cultivation of new momentum of the regional economy and create an industrial cluster of intelligent aircraft industry chain in central China.

The first phase of the project has a total floor area of 137900 square meters, mainly for all kinds of R & D and production, design plant and office space, canteen, exhibition center and other supporting service rooms, a total of 11 single buildings.

On the day the news of winning the bid was released, the share price of Zhongheng Design began to rise sharply, rising by the limit for five consecutive trading days from April 17 to April 23, with a cumulative increase of 61.06%.

Revenue has declined for four consecutive years, and the net profit and loss was once as high as 415 million yuan.

According to the annual report, Zhongheng's design revenue in 2023 was 1.73 billion yuan, down 1.73% from the same period last year. From the perspective of sub-business, the proportion of income from design consulting, project general contracting, project supervision and project management, bidding agency and consulting business is 52.11%, 27.14%, 14.36% and 4.96%, respectively. Among them, the revenue from the general contracting business of the project declined by a large margin, down 15.8% from the same period last year.

In the annual report, Zhongheng Design said that with the continuous adjustment of China's real estate industry in 2023, the development of the overall design industry is facing certain difficulties.

In terms of profit, the net profit of Zhongheng design in 2023 was 111 million yuan, an increase of 24.85% over the same period last year, while the non-net profit decreased by 15.78% to 71.073 million yuan.

Time Business School notes that Zhongheng's design revenue has been stagnant for many years since 2019, while net profit fluctuated widely over the same period.

From 2020 to 2023, the operating income of Zhongheng Design has declined for four consecutive years; in 2021, affected by the provision for bad debts of accounts receivable from real estate customers and the impairment of goodwill of subsidiaries, the net profit loss of Zhongheng Design reached 415 million yuan.

It is worth noting that the credit impairment loss of Zhongheng Design rose again to 83.5106 million yuan in 2023, an increase of 63.94% over the same period last year. Zhongheng Design said that it was mainly due to the increase in the provision for bad debts in the general contract project.

The performance of Zhongheng Design improved in the first quarter of this year. According to the quarterly report, the operating income and net profit of Zhongheng Design increased slightly by 2.62% and 2.88% respectively in the first quarter of 2024 compared with the same period last year.

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