\u3000\u3000 Sichuan Swellfun Co.Ltd(600779) (600779)
Event:
Sichuan Swellfun Co.Ltd(600779) released the annual performance forecast for 2021. In 2021, the company achieved an operating revenue of 4.632 billion yuan, a year-on-year increase of 54%; The net profit attributable to the parent company was 1.199 billion, a year-on-year increase of 64%; The net profit of deducting non return to parent was 1.216 billion, a year-on-year increase of 68%.
Key investment points:
1. In 2021, the volume and price rise together, and the main contribution increment of Jingtai and zhenniang 8. In 2021, the company achieved an operating revenue of about 4.632 billion yuan (the same as + 54%), and a net profit attributable to the parent company of about 1.199 billion yuan (the same as + 64%). In 2020, the company achieved a simultaneous increase in volume and price on the basis of a low base, with an annual sales volume of 11032 kiloliters (a year-on-year increase of about 40%), all of which came from medium and high-grade wine, and the ton price increased by about 10% year-on-year. By product, Jingtai and zhenniang No. 8 are expected to contribute to the main growth (the total revenue in the first three quarters increased by 78% year-on-year); After the company set up a high-end liquor sales company in the second half of the year, the collection products are temporarily dominated by mode introduction, rationalization of price sector and investment promotion layout, and it is expected to contribute to the increment in 2022. The company made steady progress in the national market (the revenue of the eight core markets in the first three quarters increased by more than 80% year-on-year), and the markets of Jiangsu, Zhejiang, Shanghai, Hunan and Guangdong performed well.
2. The profitability has been steadily improved, and the repeated epidemic and high expenses have put pressure on the performance in the fourth quarter. In 2021, the company's net profit margin was about 25.9% (the same as + 1.56pct, a new high in recent years). The main reason for the improvement of profitability was that 1) under the brand high-end strategy, the upgrading of product structure led to the increase of gross profit margin; 2) Sales and overhead rate optimization. Meanwhile, in Q4 of 2021, the company achieved a revenue of 1.209 billion yuan (the same as + 14%), and a net profit attributable to the parent company of 199 million yuan (a year-on-year decrease of about 13%). In the fourth quarter, the company's revenue slowed down and profits were under pressure. We judged that the main reasons were 1) the epidemic repeatedly affected the terminal mobile sales: in the second half of the year, the epidemic broke out in strong regions of Jiangsu, Henan, Zhejiang and Guangdong, and the consumption scene was limited, resulting in the pressure on the terminal mobile sales of the company. 2) Inter quarter adjustment of expense side: Q3 company's expense side was greatly optimized in 2021, and the expense postposition increased Q4 expense rate in 2021 year-on-year.
3. Profit forecast and investment rating: currently entering the peak season of Spring Festival, the company has basically achieved its goal of making a good start, the core single product well platform and zhenniang No. 8 equivalent sector are stable, and the inventory is relatively reasonable; The price of the new collection is stable first, and there are few shipments at present. In the long run, we believe that the secondary high-end is still the fastest-growing price band in the industry. The company's product structure, brand building and channel marketing are accurate, and will continue to enjoy the secondary high-end capacity expansion bonus in the future. The implementation of the recent incentive plan is expected to fully stimulate the vitality of the management, the completion of the company's assessment objectives is high, and the growth potential is still sufficient. It is estimated that the company's EPS from 2021 to 2023 will be 2.45/3.22/4.04 yuan respectively, and the corresponding PE will be 43 / 32 / 26 times respectively. It will be rated as "overweight" for the first time.
4. Risk tips: 1) repeated epidemics lead to the inhibition of consumption; 2) Increased market competition leads to increased costs; 3) the sharp fluctuation of the economy caused the price of Baijiu to slide; 4) The pace of product upgrading is less than expected; 5) Food safety risks. In case of any difference between the relevant data and information and the contents published by the company, the contents published by the company shall prevail.
