\u3000\u3000 Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) (002304)
Looking back on the past: Yanghe “stalled” for more than five years.
Baijiu Baijiu has entered a new round of development since 2015. The liquor sector in the capital market is also very bright. The Yanghe River shares rose in the top ten of the Baijiu market. Why is Yanghe’s share price underperforming? This paper attempts to find the reasons for its “stall” from the financial reporting index dimension, analyze the changes of Yanghe in the past six years from the perspective of profitability and operation ability, and try to analyze whether it has the possibility of bottom reversal.
Roe perspective: from 2015 to 2020, the roe level of Yanghe moved down from the second place in the industry to the midstream level. The ROE upgrading of the high-end Baijiu liquor is most obvious, the second high-end as a “growth” price belt, its two-way profitability and operational capacity enhancement. The Wuliangye Yibin Co.Ltd(000858) and Luzhou Laojiao Co.Ltd(000568) of the 1000 yuan price band have also improved significantly. Although the ranking of Maotai has decreased, it is stable and the leading effect is still in place. The overall ranking of Yanghe, Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) , Anhui Kouzi Distillery Co.Ltd(603589) , Gujing and other local wines has moved backward. From this point of view, the relative backward ranking of roe of Yanghe belongs to an industrial phenomenon. However, it is worth noting that Yanghe has missed the opportunity of national sub high-end development to a certain extent, which has strengthened the attribute of local wines and weakened the attribute of nationalization.
From the perspective of statement: an analysis of the way of breaking through the encirclement of Yanghe River.
From the perspective of net interest rate: the net interest rate of Yanghe has been basically flat for six years, which is also the main reason for the decline of its roe. The main reasons affecting the net interest rate of Yanghe are the change of tax rate, investment income and product structure. 1) Tax rate change: compared with comparable companies, Yanghe expects the negative contribution of tax rate change to net interest rate to increase by 2-4pct. 2) Changes in investment income: after adjustment, the net interest rate of Yanghe basically changes in the same direction as that of comparable companies. The net interest rate will recover in 2021, but the increase is small compared with Luzhou Laojiao Co.Ltd(000568) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) . 3) Change of product structure: the change of product structure determines the change of gross profit margin to a great extent. The gross profit margin of Laojiao increased from 49% (2015) to 86% (2021q3). The gross profit margin of Fenjiu and Yanghe rose alternately, and the increase range of gross profit margin was basically the same. Compared with the three companies, the upward movement of gross profit margin brought by the improvement of product structure is the main reason for the increase of net profit margin of Laojiao, and the scale effect brought by the rapid growth of revenue is the main reason for the increase of net profit margin of Fenjiu. In this dimension, revenue acceleration and structural adjustment are the only two breakthroughs for Yanghe.
Can the revenue be accelerated? There are opportunities and challenges. From the perspective of the provincial market, the successful replacement of dream 6 + can ensure the development of Yanghe in the province in the next 2-3 years, but the growth in a longer dimension requires the cultivation and momentum of iterative products. From the market outside the province, the market around Jiangsu is in urgent need of “make-up lessons”, and it still takes time to speed up. However, Yanghe’s strong marketing network and long-term regional deep cultivation make it not difficult to “revive” the market around Jiangsu. Can the upgrading of product structure be accelerated? Short term “consolidation” and speed-up can be expected. 2019-2021 is the year of strategic renewal and adjustment of the company. Under this tone, the proportion of Dream Blue products is relatively slow to increase compared with 2015-2018. With the rise of the atmosphere of dream 6 + outside the province and the promotion of products undertaken in the province, the subsequent structural upgrading can be accelerated.
From the perspective of operation, from 2019 to 2020, the company “scratched the bone and healed the wound”. Although the performance side experienced a “hard landing”, the report quality was significantly improved. Since 2019, the advance payment has increased significantly year-on-year, and the dealers’ willingness to purchase goods has increased. At the same time, the company has taken the initiative to reduce the pressure on the dealers, and other payables have been significantly reduced, creating good conditions for the subsequent accelerated development.
Profit forecast and investment suggestions: slightly adjust the net profit attributable to the parent company from 2021 to 2023 to RMB 7.58/98.2/11.48 billion respectively (the original forecast was RMB 7.72/96.4/11.49 billion), year-on-year + 1.2% / 29.6% / 17.0%, corresponding to 31 / 24 / 21 times of PE, maintain the “buy” rating, and maintain the target price of RMB 245, corresponding to 38 times of PE in 2022.
Risk warning: the cultivation of consumers is not as expected; The process of nationalization is too slow; The overall demand for Baijiu industry has shifted significantly.
