The Company's 2020 operating results beat our expectation. Revenue in 2020 went up 9.3% YoY to RMB270.3 bn while net profit to shareholders dropped 11,0% YoY to RMB4,517 mn. Revenue in 2020 was 8.1% and net profit was 10.5% above our estimation for the year. Sales in 2H2020 surged 20.0% YoY to RMB164.73 bn and net earnings jumped YoY by 25.4% to RMB3.66 bn. On a HoH basis, sales and net earnings in 2H2020 surged 56.0% and 325.5%, respectively. The recovery of the Company in 2H2020 was stronger than we previously anticipated. Consolidated gross margin in 2020 was up by 0.3 ppt YoY to 13.4% while net margin was down 0.4ppt YoY to 17% as a result of decrease in non-operating income.
Newly signed contracts in 2020 reached RMB577.8 bn, up YoY by 11.0%* In which, domestic new contracts in 2020 amounted to RMB399.3 bn, up 9.0% YoY, while new overseas contracts reached RMB178.5 bn, up 15.9% YoY, Orders backlog exceeded RMB1.36 trillion as at June 2020 and is estimated to have reached RMB1,6 trillion as at the end of 2020. We expect the new contracts of the Company to continue to record strong growth rates going forward,
We maintain the "Accumulate" investment rating and raise the TP to HK$1.19, We are optimistic about the outlook of the Company given its better-than-expected 2020 operations and strong orders backlog. Cur adjusted EPS estimates from 2021 to 2023 are RMB0.199/ RMB0.224/ RMB0.257, respectively. The new TP corresponds to 5.0x/ 4.4x/ 3.9x 2021-2023 PER or 0.5x/ 0.5x/ 0.4x 2021-2023 PBR.