\u3000\u3000 Chongqing Fuling Zhacai Group Co.Ltd(002507) (002507)
Event: the company achieved a revenue of 2.519 billion yuan in 2021, with a year-on-year increase of 10.82%; The net profit attributable to the parent company was 742 million yuan, a year-on-year increase of – 4.53%; The net profit attributable to the parent company after non deduction was 694 million yuan, a year-on-year increase of – 8.50%. Among them, 2021q4 achieved a revenue of 563 million yuan, a year-on-year increase of 18.74%; The net profit attributable to the parent company was 238 million yuan, a year-on-year increase of 45.74%; The net profit attributable to the parent company after non deduction was 209 million yuan, a year-on-year increase of 32.39%.
Revenue growth accelerated month on month, and the effect of price increase was obvious. Q4’s revenue increased by 18.74% year-on-year, accelerating significantly from 8.73% in the first three quarters. It is rare when the base number of 2020q4 is high. We believe that the main reasons are: (1) according to the announcement, the company adjusted the ex factory prices of some products on November 12, and the increase range of each category is 3% – 19%, which is expected to promote the significant increase of Q4 average price; (2) In the first three quarters, the effect of the company’s air advertising gradually appeared, driving the growth of sales; (3) The company’s new low salt products also contributed to some sales growth. Looking forward to 2022, the price increase will continue to promote the growth of the company’s revenue.
Price increase + expense rate contraction + interest increase, pushing Q4 profit higher than expected. In 2021q4, the net interest rate attributable to the parent company was 42.30%, a significant increase of 7.84 PCT year-on-year. It is expected that the gross profit rate of 2021q3 will be significantly narrower than that of 2021q4, and the gross profit rate of 2021q3 will also be significantly lower than that of 2021q4. Second, the company actively uses idle self owned funds and raised funds for financial management, which is expected to bring significant interest income year-on-year 2020q4. Third, after the strong investment in air advertising in the first three quarters, the investment in air advertising of 2021q4 company is expected to decrease. At the same time, as a traditional off-season, the market investment cost in the fourth quarter is also low, and the cost rate is expected to show a year-on-year downward trend.
The cost of green vegetables is expected to fall, and the profit elasticity in 2022 is expected. Looking forward to 2022, we expect the company to release greater profit elasticity. First, the year-on-year contribution of the company’s price increase will continue until November 2022. In the short term, the sales volume may be under pressure due to the price increase, but usually after a period of market digestion, the sales volume will gradually return to normal. Second, the price of fresh vegetables purchased by the company in early 2021 rose sharply, and it is expected that the purchase price of fresh vegetables at the beginning of this year will return to the normal level. Third, under the background of high base of sales expenses in 2021, especially air advertising expenses, the sales expense rate is expected to decline in 2022.
Profit forecast: according to the company’s performance express, taking into account the space for future cost reduction and sales expense rate decline, we adjust the profit forecast. It is estimated that the company’s revenue from 2021 to 2023 will be 2.519 billion yuan, 2.902 billion yuan and 3.294 billion yuan respectively, the net profit attributable to the parent company will be 742 million yuan, 993 million yuan and 1.250 billion yuan respectively (668 million yuan, 924 million yuan and 1.109 billion yuan before adjustment), and the EPS will be 84 million yuan, 1.12 million yuan and 1.41 yuan respectively, The corresponding PE is 37 times, 28 times and 22 times, maintaining the “buy” rating.
Risk warning events: repeated global epidemics and slowing economic growth; Price fluctuation risk of raw materials; Channel development fails to meet expectations; New product promotion failed to meet expectations
