\u3000\u3000 Wuliangye Yibin Co.Ltd(000858) (000858)
China Baijiu has a structural upgrading trend, and the position of high-end liquor brands is stable. At present, the Baijiu industry has shown a long time of “excess capacity” and “insufficient supply of quality capacity”. With the steady increase of the number of affluent families and the per capita consumption level, the demand for “Baijiu” has been increasing. Wuliangye Yibin Co.Ltd(000858) and other high-end Baijiu enterprises, due to their strong brand background and high product scarcity, are not duplicable. In the long term trend of the structural upgrading of the industry, the company’s comprehensive competitiveness is expected to increase continuously, and the market survival space of other small and Medium wine enterprises will be squeezed. The Baijiu Baijiu Baijiu Baijiu is a continuous development of the liquor industry. The liquor industry has a clear logic of maintaining the bottom line of the continuous development of the liquor industry. Therefore, we judge that the liquor market competition pattern in the coming 14th Five-Year will remain the home court of the high-end mainstream liquor companies. The trend of the liquor industry differentiation is expected to become more obvious in the future.
The company’s core competitive advantage is significant, and the problems left over by history are gradually improved: Wuliangye Yibin Co.Ltd(000858) the group has industry-leading natural advantages such as scarce high-quality production capacity and high-end positioning of its core brand. It is not only the core competitive barrier of the company, but also the cornerstone leading the long-term and stable growth of the company’s future performance. In addition, due to the company’s implementation of “secondary entrepreneurship” in recent years, the company has carried out all-round reforms in production capacity optimization, product brand, channel marketing, physical mechanism and other aspects, the company’s historical problems have been gradually improved, and the company has gradually realized the return of high-end brand value, which has been particularly effective in promoting its overall performance. We believe that Chinese Baijiu Baijiu market is expected to achieve steady growth in the future, and the long-term performance is expected to continue to achieve breakthroughs in the long run.
The management adjustment is officially implemented, and the performance is expected to catalyze sound development: the company is in the transition stage of management change recently, which has led to many negative effects, such as large overall delivery volume, weakening the control of delivery rhythm, insufficient market supervision, unstable pricing of core products and so on. According to the company’s recent announcement, the company management adjustment has officially landed. The current leading group has many years of experience in Wuliangye Yibin Co.Ltd(000858) group, and has a rich understanding of the Baijiu market and company management. The leading body is expected to be more stable, faster and better. With the gradual recovery of the company’s management cohesion, we expect that the company will continue to launch various measures to continuously strengthen the marketing of core brands, fine management of channels, implementation of market inventory and price control, so as to once again catalyze the benign development of the company’s product volume, price and performance.
The target price is 253.87 yuan, with a buy rating for the first time: To sum up, we are optimistic about the company’s long-term ability to achieve “simultaneous rise in volume and price” in the future. It is expected that the company will achieve revenue of 67.62/77.47/90.71 billion yuan from 2021 to 2023, with a year-on-year increase of 18% / 15% / 17% and net profit attributable to parent company of 23.71/281.5/33.31 billion yuan, with a year-on-year increase of 20% / 18% / 18%. The current stock price of the company has dropped below 30x compared with the profit forecast of 2022, which has fully reflected the pessimistic expectation of the market on the previous negative impact of the company. With the internal personnel adjustment settled, the concerns about the uncertainty of the company’s future development are expected to gradually improve, and the valuation and performance are expected to be repaired. Therefore, we give the company a target price of 253.87 yuan, which is equivalent to 35 times of the profit forecast in 2022, and give a buy rating for the first time.
