Huaxi Securities: Maintaining China's Chunlai (01969) “Buy” Rating Has Broad Room for Growth
The Zhitong Finance App learned that Huaxi Securities released a research report stating that it maintained China's Chunlai (01969) profit forecast, maintained FY26's annual revenue forecast of 2,140 billion yuan, added FY27-28 revenue forecast of 24.04/2,631 billion yuan; maintained FY26 net profit forecast of 1,033 billion yuan, added FY27-28 forecast of 11.72/1,290 billion yuan; maintained FY26EPS of 0.86 yuan; added FY27-28EPS forecast of 0.98/1.07 yuan, corresponding to the closing price of HK$4.36 on December 3, 2025 FY26-284.6/4.1/3.7XPE, maintaining a “buy” rating.
Huaxi Securities's main views are as follows:
FY2025 results
FY2025's revenue/net profit/adjusted net profit was $1,791/8.36/837 million yuan respectively, up 9.8%/7.4%/5.9% year-on-year. Among the adjustments to net profit attributable to the mother, the share-based compensation FY 2025 was 3.29 million yuan, and the exchange side of FY 2025 was 1.96 million yuan in exchange.
High performance growth for Shangqiu University, Yuanyang Campus of Anyang University, School of Health, and Jingzhou University
(1) Looking at revenue splitting, FY2025 Group's tuition fee/accommodation revenue was 1,636/154 million yuan, respectively, an increase of 10.1%/6.3% over the previous year.
(2) In terms of school revenue, Shangqiu College/Shangqiu University School of Applied Science and Technology/Anyang University Yuanyang Campus/Health College/Jingzhou College were 4.16/2.60/4.19/2.16/1.38/ 341 million yuan respectively. Among them, Shangqiu University, Shangqiu University Applied Science and Technology School, Anyang University Yuanyang Campus, Health College, and Jingzhou University increased year-on-year revenue mainly due to the increase in the number of students enrolled.
(3) In terms of the number of students enrolled, the total number of students enrolled in FY2025 was 110,000, an increase of 6.4% over the previous year.
(4) By school, the average number of students enrolled in Shangqiu College/Shangqiu University School of Applied Science/Anyang University Yuanyang Campus/Health College/Jingzhou University was 26,165/15,499/26,143/13,045/9,743/19,357, respectively. Shangqiu University/Shangqiu University Applied Science and Technology/Anyang University/Anyang University Yuanyang Campus/Health College/Jingzhou University average tuition fees were 1.59/1.68/1.60/1.65/1.41/17,76 yuan respectively.
The Group has plenty of cash and broad room for growth
FY2025 Group's cash and cash equivalents were $832 million, up 5.2% year on year; contract liabilities were 682 million yuan, down 1.7% year on year. The bank believes that the company's room for growth lies in:
(1) The number of students enrolled is expected to increase steadily, mainly due to the increase in the Yuanyang Campus/Health College/Jingzhou College of Anyang University. It is expected that Tianping University will be able to apply for a change of school organizers after the new campus is completed, and it can be combined after the transformation is completed in 2026, driving the company's growth in the number of students enrolled and revenue.
(2) The company's colleges are mainly located in Henan, Hubei and Jiangsu provinces. There is still plenty of room for future tuition increases, and there is room for continuous reduction in financial expenses through debt replacement, leading to an increase in net interest rates.
(3) Actively expand international education business cooperation. In November 2024, Anyang University and Shangqiu University signed a Sino-foreign school cooperation agreement with the Australian Elite School of Education, and Anyang University and New Zealand's Massey University signed a Sino-foreign cooperation agreement. The company continues to seek overseas cooperation with the aim of building a bridge for students to continue their studies, and domestic and foreign schools can have a good synergy effect.