Diou Home Furnishing (002798): Repurchase plans to stimulate governance governance structure hopes to improve

Event: The company plans to use its own funds to repurchase some public public shares through the secondary market through centralized bidding.

The total amount of funds for this repurchase is not less than RMB 0.

5 trillion (inclusive) and no more than RMB 1 trillion (inclusive), which is used as the source of stocks for the implementation of the distribution incentive plan or employee stock ownership plan in the future; the estimated number of repurchasable shares is 333.

330,000 shares, accounting for about 0 of the company’s total share capital.

86%.

At the same time, the company released some directors of the company, and the senior management plans to reduce its holdings of the announced shares within 6 months after 15 trading days from the date of this announcement.

Total reductions 376.

680,000 shares, about 0 of the company’s total share capital.

98%.

Opinion: Repurchase is an incentive for employees, and the company’s long-term governance structure has been optimized.

The company intends to use 0.

500 million to 100 million US dollars of funds to repurchase shares, if the repurchase ceiling price is 30 yuan per share, it will repurchase up to 333.

330,000 shares, a minimum of 166 will be repurchased.

670,000 shares.

The share repurchase will be used for employee incentives. Considering that Oscino’s compliance with the shareholding ratio, if the repurchase is all used to participate in the distribution incentives of Oscino, the ownership of Oscino will increase by about 1pct, and the corporate governance structure will beFurther optimized.

At present, Osgenol has developed rapidly. In 2018, the revenue and profit growth rates were 都市夜网 greater than 50% and 60%, respectively. This employee incentive plan will not only help protect the development of Osgenol in the next 3 years, but also eliminate some investors’After the executives ‘performance gambling period (2017-2019) is completed, we believe that through the introduction of incentives to the future, the interests of executives of Eurosnow will be further tied to the size of listed companies, which will be beneficial to the long-term development of listed companies.

Reduced holdings or risks, business confidence remains unchanged.

Taking into account the current reduction of 376.

680,000 shares, according to the closing price of 21 in the most recent trading day.

The calculated market value of 48 yuan / share is about 80.91 million yuan, and we believe that it will have a relatively limited impact on the secondary market.

At the same time, the current controlling shareholder’s equity pledge ratio exceeds 60%, and the issue minus the holding proceeds may be used to reduce the equity pledge ratio and reduce secondary market risks. The funds raised by Dong Jiangao will be used to reduce bank debt.

At present, the company is in a stage of rapid development, and senior executives are confident about the company’s development. Investment recommendations: The company has a long-term growth space and a high degree of certainty in the next three years.

We estimate that the company’s net profit attributable to its parent in 2019-2021 will be 5, respectively.

5, 7.

5 billion, the closing price on May 3 corresponding to PE were 13 respectively.

8 times, 10.

0 times and 7.

4 times, continuous recommendation.

Risk warning: The real estate market exceeds expectations, and channel expansion is less than expected.