\u3000\u3000 Chongqing Fuling Zhacai Group Co.Ltd(002507) (002507)
Event: Chongqing Fuling Zhacai Group Co.Ltd(002507) released the performance express of 2021. The total operating revenue of the whole year was 2.519 billion yuan, 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%, and the net profit attributable to the parent company after deduction was 694 million yuan, a year-on-year increase of - 8.50%; Single Q4 achieved a total operating income of 564 million yuan, a year-on-year increase of + 18.80%, and a net profit attributable to the parent company of 238 million yuan, a year-on-year increase of + 45.81%. After deduction, the net profit attributable to the parent company was 208 million yuan, a year-on-year increase of + 31.65%. The profit performance of 21q4 exceeded market expectations.
21q4 revenue growth bottomed out and rebounded, and the improvement of profit margin promoted the performance to exceed expectations. In 21q4, with the return of benign inventory, large-scale terminal demand and the effect of price increase, the revenue growth rate is significantly higher than that in Q3; The improvement of profit margin pushed the performance higher than expected. The net profit margin attributable to the parent company in 21q4 was 42.30%, with a year-on-year / month on month ratio of + 7.83pct / + 21.35pct respectively, deducting the net profit margin not attributable to the parent company of 36.91%, and a year-on-year / month on month ratio of + 3.57pct / + 18.35pct respectively. We judged that it was mainly due to: 1) the price increase alleviated the cost pressure: the company had raised the ex factory price of some products in November 21, with a range of 3% - 19%, superimposing the upgrading of product structure, Q4 gross profit margin is expected to improve significantly month on month; 2) Contraction of sales expense rate: 21q1-q3 company added 223 million yuan of brand publicity expenses, accounting for 11.41% of revenue, which increased the sales expense rate of q1-q3 to 26.56% (year-on-year + 10.84pct). Channel research found that 21q4 promotion decreased, and the sales expense rate is expected to decline.
22 year profit elasticity is expected to continue to release. 1) The effect of price increase continues to be reflected: while the price increase improves the gross profit margin, with the completion of transmission to the terminal, the channel profit margin will gradually increase, and the channel enthusiasm is expected to continue to improve; 2) Cost pressure eased year-on-year: according to the company's disclosure, the acquisition of fresh vegetable head has been started in 2022. At present, it is acquired at an average price of 800 yuan / ton. It is expected that the average price will be significantly improved year-on-year in 2021 after the acquisition is completed; 3) Improvement of expense ratio: in 2021, the company increased investment in advertising and publicity, and the profit is under pressure. The year-on-year decline of sales expense ratio in 2022 will further release the profit elasticity. In the long run, with the continuous deep excavation of third and fourth tier cities, the increase of e-commerce coverage and the expansion of radish and pickles, the company has a high growth space.
Investment advice. Considering that the company's profit improvement exceeded expectations, we raised our previous profit forecast. It is estimated that the company's operating revenue from 2021 to 2023 will be RMB 2.52/29.3/3.44 billion (the previous value was RMB 2.49/29.6/3.4 billion), a year-on-year increase of + 10.8% / + 16.3% / 17.2%; The net profit attributable to the parent company was RMB 740 / 10.4 / 1.32 billion (the previous value was RMB 700 / 9.6 / 1.18 billion), with a year-on-year increase of - 4.5% / + 40.1% / + 27.2%. The current valuation corresponds to pe27x / 21x in 2022-23, maintaining the "buy" rating.
Risk tip: the industry demand is lower than expected, and the cost of raw materials is higher than expected.
