The property has obvious drunk cycle attribute, and the elasticity is expected to be released in 2022. In the past, Baijiu of three wheeled liquor was lagging behind in many dimensions. High end liquor usually appears in the initial price of each round of Baijiu market, and the elasticity of performance is released first. At the same time, the price of other liquor companies is increased. The release of the elasticity of real estate is often later than that of high-end and secondary brands. In the first three rounds of Baijiu bull market, real estate liquor showed a lagging release in the stock price, revenue and profit. At present, the performance elasticity of local wine has been released since 2021q1, and it is expected to accelerate in 2022. Benefiting from the acceleration of the consumption upgrading of the real estate companies and the upward shift of the price of the Baijiu liquor, the real estate liquor started to start in early 2021, and the 2021Q3 performance accelerated significantly. Considering that the elasticity of real estate liquor has not been fully released compared with the national sub high-end famous liquor enterprises, it is expected to maintain the rapid growth trend in the third quarter of 2021 in 2022.
The real estate liquor market is divided into three categories, and Jiangsu and Anhui are the representatives of the closed market. According to the market share of real estate liquor enterprises in the provincial market and the degree of control over channels, the real estate liquor market is mainly divided into closed market, semi open market and open market. The closed market is represented by Jiangsu and Anhui. Relying on the advantages of high viscosity of local consumers and strong channel share, it has a high market share in the province. For example, Yanghe, the two leading real estate wine in Jiangsu market, and Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) exceed 70% in the secondary high-end CR2.
Jiangsu ushered in the fourth consumption upgrading, with the price band of more than 500 yuan for real estate wine. Baijiu market in Jiangsu: the Baijiu market in 2020 was about 50 billion, and it was expected to increase to 60 billion in 2021. In terms of brand market share, Yanghe, Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) leading real estate liquor enterprises and Maotai and Wuliangye Yibin Co.Ltd(000858) Cr4, national famous liquor enterprises, account for 56%, of which Yanghe and Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) account for more than 70% of the secondary high-end. Consumption upgrading in Jiangsu Province: Jiangsu Province has experienced three rounds of complete consumption upgrading in the past. The real estate liquor leader has achieved accelerated growth in revenue and performance by accurately controlling the trend of each round of consumption upgrading. At present, the fourth consumption upgrading has been launched in the province, and the main price belt is from 300-400 yuan to more than 500 yuan. The leading real estate liquor companies are arranged in advance. It is expected that the profitability will be further improved with the optimization of product structure in 2022.
The mainstream price of Hui liquor has risen to more than 300, and local liquor is expected to monopolize the secondary high-end. Baijiu market in Anhui: the CAGR of Baijiu in the 2017-2021 year is about 9%, of which the second high-end price band (300-800 yuan) expanded from about 1 billion 300 million in 2017 to about 5 billion in 2021. In terms of concentration, the market share of local wine leaders in the province in the secondary high-end market has increased from about 20% in 2018 to 70%, of which gujinggong accounts for about 50%. Consumption upgrading in the province: the third consumption upgrade in the province is now open, and the mainstream price of Baijiu is rising to more than 300 yuan. Moreover, we expect that this round of consumption upgrading in Anhui will be faster than the last round in Jiangsu. The “three heroes of Hui liquor” have evolved from the competitive state of the past to competitive and cooperative development. In 2022, they will continue to benefit from the deepening of consumption upgrading in a relatively stable pattern.
Investment advice: from the industry perspective, the Chinese Baijiu industry is in the fourth round of the bull market later. The real estate liquor is expected to monopolize the second high-end price band in the province, and the performance elasticity is expected to be fully released in 2022. From the perspective of individual stocks, the Baijiu sector is currently in the value allocation section, and the real estate sector is the first to launch Anhui Kouzi Distillery Co.Ltd(603589) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Gujing Distillery Company Limited(000596) , Anhui Yingjia Distillery Co.Ltd(603198) and Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) .
Risk tip: the upgrading of consumption in the province is less than expected, the epidemic situation is repeated, and food safety problems.
