\u3000\u3000 Yunnan Botanee Bio-Technology Group Co.Ltd(300957) (300957)
Performance overview: the company issued a performance pre increase announcement. It is expected that the company will realize a net profit attributable to the parent company of 820-890 million yuan in 2021, with a year-on-year increase of 50.87% – 63.75%, deduct the net profit not attributable to the parent company of 770-840 million yuan, with a year-on-year increase of 50.20% – 63.85%, and non recurring profit and loss of 45-55 million yuan, mainly due to the investment income and government subsidies obtained by the company through cash management with idle funds; It is estimated that in 2021q4, the net profit attributable to the parent company will reach 465-535 million yuan in a single quarter, with a year-on-year increase of 41.77% – 63.11%.
Performance review: stick to large single products + all channels, and the annual performance exceeded expectations. 1) on the product side, Winona’s core product line “Shu Min” series of special cream, sunscreen cream, two super large single products, continuous volume, contribute to stable cash flow for the company, and rely on strong brand strength. In the second half of 2021, Winona’s high moisturizing repair cream, freeze-dried mask and other explosive products also showed bright eye. 2) tiktok, the company continued to adhere to the advantages of online multi platform channels, the effect of online platform centralization is obvious, the company’s overall proportion of Tmall’s total channel in 2021 and the proportion of Tmall’s Master Live broad-based users continued to decline in the first three quarters of the year. We expect the flow cost of the company to decline in 2021. In addition to strengthening the image of the first OTC chain stores in Hangzhou and Shanghai, it is expected that the first OTC chain stores in Guangdong will be opened in December this year. In addition, it is expected to further enhance the image of the first OTC chain stores in Shanghai 5-10 brand image stores are opened in the core business district of second tier cities to open up the interactive closed loop of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) members.
Future highlights: the brand continues to push through the old and bring forth the new, and the industrial chain extends upstream. 1) In terms of multiple brands, Winona baby will divide its product lines according to the ages of 0-3, 3-6 and 6-12 this year. It is expected that a number of new products will be launched in the second half of this year. It will continue to rely on the competitiveness of clinical endorsement and the foundation of offline channels to move towards medium and high-end. Aoxmed, a new anti-aging brand, is positioned at the high end. It is expected to start from offline medical and beauty institutions in May this year. In the later stage, it may replicate the main brand playing method and adopt the offline radiation online mode for promotion; 2) In terms of industrial chain, the company takes the lead in the construction of Yunnan characteristic plant extraction laboratory, focuses on using the resources of Yunnan characteristic plants, and seeks the R & D breakthrough of local plant industry in functional skin care products, functional foods, drugs and other aspects. In the future, the company is expected to expand it into an internal R & D service platform.
Profit forecast and investment suggestions: the company has taken the lead in the sensitive skin care track. The main brand Winona takes the “Shumin” series as the core and superimposes the launch of multi category pipelines, which will continuously enhance its popularity. In the future, the company will also actively incubate sub brands, create a differentiated product matrix, further deepen the multi brand and multi category layout, and strengthen marketing and channel capabilities, The company is expected to stabilize its leading position for a long time. We maintain the company’s total operating revenue forecast for 2021-2023 to be 38.73/54.78/7.179 billion yuan respectively (the growth rate is 47% / 41% / 31% respectively), slightly raise the forecast of net profit attributable to the parent company to 852/11.97/1.595 billion yuan respectively (the growth rate is 57% / 40% / 33% respectively), EPS to be 2.01/2.83/3.77 yuan respectively, and the current market value corresponding to PE is 82 / 58 / 44 times respectively. The compound growth rate of the company’s performance in the next two years is 35% – 40%. Considering the growth of the company’s sensitive muscle track and the company enjoys a certain degree of leading premium, the company is given 2xpeg in 2022, corresponding to 70x-80xpe, and the reasonable price range of the company is 198.10-226.40 yuan, maintaining the “recommendation” rating of the company.
Risk warning: industry competition intensifies the risk; Product promotion is not as expected; Weak consumer demand as a whole.
