\u3000\u3000 Qianhe Condiment And Food Co.Ltd(603027) (603027)
Event: Qianhe Condiment And Food Co.Ltd(603027) issued the announcement of fixed increase and equity incentive. 1) the company plans to raise 500-800 million yuan from Wu Chaoqun, the actual controller, at an issue price of 15.59 yuan / share. After deducting the issuance expenses, it will be used for the intelligent seasoning project with an annual output of 600000 tons; 2) The company plans to grant 4.59 million restricted shares to 73 middle and senior managers and core backbones, accounting for about 0.58% of the total share capital of the company at the time of announcement of the draft incentive plan, and the grant price is 9.79 yuan / share. The restricted shares will be lifted in three batches (40% / 30% / 30%) within 36 months from the date of registration. The assessment goal is that the revenue from 2022 to 2024 will increase by no less than 18% / 38% / 60% compared with 2021 The net profit increased by no less than 50% / 90% / 130% compared with 2021.
Capacity expansion opens up room for growth, and equity incentives stimulate business vitality. 1) The fixed increase is fully subscribed by major shareholders in cash, demonstrating their confidence in the long-term development of the company. At the same time, the condiment intelligent system project includes 500000 tons of brewing soy sauce production capacity and 100000 tons of cooking wine production capacity. After reaching the production capacity, it will alleviate the production capacity bottleneck and enhance the scale advantage of the main condiment industry; 2) According to the calculation of the restricted stock grant price of 9.79 yuan / share and the closing price of 19.66 yuan / share the day before the announcement, the average income of each incentive object is 620000 yuan. The implementation of incentive is expected to further stimulate the endogenous business vitality of the company.
Intensive cultivation of channels + improvement of product matrix, and the process of nationalization is expected to speed up. 1) The development of circulation and catering channels is accelerated, and the 22-year nationalization process is expected to speed up. Taking high-end zero addition as a breakthrough, the company has completed the national Ka supermarket channel layout, but there is still a large blank market in the circulation and catering channels. The company has strengthened the channel expansion since 2021q2. At the same time, with the recovery of industry demand, the inflection point of 2021q3 company’s operation has emerged. Looking forward to the future, with the marginal recovery of catering channels, the company’s national expansion is expected to accelerate; 2) Layout cost-effective products and cooperate with channel breakthroughs. 2021h2 company has launched a number of new products with higher cost performance, such as zero addition of new products and high fresh soy sauce, to accelerate the penetration of C-end circulation and b-end catering channels. With the completion of early market cultivation and promotion, it is expected to increase the volume rapidly in the future.
The cost-effectiveness ratio is expected to gradually ease the pressure of publicity. 1) The advertising contract amount of 2021q1 and 2021q2 is about 55 million yuan and 43 million yuan respectively, resulting in a significant year-on-year increase in the sales expense rate. In 2022, the company is expected to optimize the expense delivery structure and enhance the expense output efficiency. 2) In 2021, with the rising prices of packaging materials and soybeans, the company’s gross profit margin is under pressure periodically. With the pressure on the cost side slowing down and the effect of price increase, the subsequent performance elasticity is expected to be released.
Profit forecast and investment suggestions. Zero addition nationalization of the company is imminent. With the marginal recovery of catering channels in 2022, the company is expected to accelerate the process of nationalization. Considering the company’s brand position and the acceleration of nationalization, we raised the previous profit forecast. It is estimated that the company’s operating revenue from 2021 to 2023 will be 1.92/24.7/3.07 billion yuan (the same as the previous value), a year-on-year increase of + 13.2% / + 28.9% / 24.3%; The net profit attributable to the parent company was RMB 220 / 370 / 490 million (the previous value was RMB 220 / 3.5 / 450 million), a year-on-year increase of + 7.3% / + 69.8% / + 29.9%. The current valuation corresponds to PE 42x / 32x in 2022-23, maintaining the “buy” rating.
Risk tip: the nationwide expansion is not as expected; The cost continues to rise; Intensified competition
