Dongxing Securities Corporation Limited released a research report stating that YUEXIUTRANSPORT (01052) plans to acquire an 85% stake in the Shandong section of Qinbin Expressway (from the Shandong-Hebei border to Zhanhua) for RMB 1.154 billion. The target road asset spans 60.7 kilometers with a remaining toll period slightly exceeding 20 years. The acquired asset is already profitable, and the firm remains optimistic about its future performance as well as the expansion prospects of Guangzhou North Second Ring Expressway, maintaining a "Strong Buy" rating. Key points from Dongxing Securities are as follows:

Qinbin Expressway connects multiple ports along the Bohai Bay, offering significant regional advantages. As the fastest coastal expressway in the Bohai Rim region, it runs from Qinhuangdao Port in the north to Zhanhua District in Binzhou, Shandong, passing through key ports like Tianjin Port and Huanghua Port. The acquired Shandong section includes a major bridge (Zhangweixin River Bridge) and demonstrates strong revenue generation.

From 2023 to the first eight months of 2025, Qinbin Expressway generated revenues of RMB 563 million, RMB 752 million, and RMB 546 million, respectively. Calculated per kilometer per day, the figures stand at RMB 25,000, RMB 34,000, and RMB 37,000—well above the average for four-lane expressways. While the bridge tolls slightly inflate the metric, the expressway’s performance still outshines most of YUEXIUTRANSPORT’s other holdings, except Guangzhou North Second Ring Expressway.

The revenue surge in 2024–2025 was partly driven by traffic diversion due to the expansion of the parallel Rongwu Expressway (Cangzhou section). However, with Rongwu Expressway reopening in October 2025, Qinbin’s revenue is expected to normalize to around RMB 599 million in 2026, slightly higher than 2023 levels.

The acquisition is financially attractive, with an estimated internal rate of return (IRR) of 10.43% (compared to 9.2% for the previous Pinglin Expressway acquisition). The total enterprise value (EV) of RMB 6.225 billion translates to approximately RMB 100 million per kilometer—below the average construction cost for similar expressways in coastal regions. With a remaining toll period of over 20 years, the asset avoids the initial traffic cultivation phase, further enhancing its appeal.

The acquisition is expected to extend the weighted average toll period of YUEXIUTRANSPORT’s portfolio by 0.8 years. Projected net profits for 2026–2028 are RMB 124 million, RMB 162 million, and RMB 195 million, respectively. After accounting for financing costs, the deal could add roughly RMB 100 million to 2026 earnings.

Excluding the acquisition, Dongxing Securities forecasts 2025–2027 net profits of RMB 755 million, RMB 769 million, and RMB 822 million, with P/E ratios of 8.7x, 8.6x, and 8.0x. The acquisition would further boost earnings from 2026 onward.

Risks include policy shifts, economic slowdown, underperformance of acquired assets, and higher-than-expected expansion costs.