\u3000\u3000 Chongqing Fuling Zhacai Group Co.Ltd(002507) (002507)
In the fourth quarter, the performance grew brightly and the profitability improved significantly
The company announced the performance express for 21 years: the company achieved an operating revenue of 2.52 billion, a year-on-year increase of + 10.8%; The net profit attributable to the parent company was 740 million, a year-on-year increase of – 4.5%; The net profit deducted from non parent company was 690 million, a year-on-year increase of – 8.5%. Among them, Q4 achieved an operating revenue of 560 million, a year-on-year increase of + 18.7%; The net profit attributable to the parent company was 240 million, a year-on-year increase of + 45.7%; The non net profit deducted was 210 million, a year-on-year increase of + 32.4%. The company’s Q4 report performance is bright and its profitability is significantly improved.
Price increase + contraction of fee delivery + increase of financial income drive the significant improvement of performance in the fourth quarter
The revenue growth rate in 2021q4 was + 17.4pct month on month, mainly due to the price increase of most products by the company in November 2021, with an increase of about 15%. In 2021q4, the profit growth rate was + 84.8pct month on month, the net profit rate increased by 21.4pct month on month to 42.3%, and the profitability was significantly improved, mainly due to: (1) the price increase last year covered the rising pressure of the company’s cost, and the gross profit margin improved month on month; (2) In 2021, q1-q3 company invested about 220 million in brand publicity in order to improve brand awareness, but 21q4 terminated the investment in advertising, and the cost rate decreased month on month; (3) In 2021q3, the company temporarily deposited the funds raised by the fixed increase in the bank and purchased financial products, and the financial income was improved.
The purchase price of qingcaitou has dropped, and the profit elasticity is expected to be fully released this year
Driven by the price increase and local promotion, it is expected that the revenue end of the company will maintain a month on month acceleration trend in 2022. In addition, due to factors such as increasing production, it is expected that the purchase price of the company’s main raw material qingcaitou will fall to the normal level of less than 800 yuan this year (year-on-year – 38%). However, considering that the company lags behind the use of qingcaitou for half a year after purchasing qingcaitou, the improvement of the company’s gross profit margin will be more reflected in 2022h2 and 2023. On the expense side, the company’s expense investment this year will be more rational, and the advertising expense is expected to shrink significantly. Therefore, the overall sales expense rate of the company will decline in 22 years, and the gross sales difference will continue to improve, boosting the recovery of profitability. It is suggested to pay attention to the profit elasticity of Chongqing Fuling Zhacai Group Co.Ltd(002507) in 2022.
Risk warning: channel expansion is lower than expected; The cost of raw materials fluctuates greatly; The cost is higher than expected.
Investment advice: maintain the “buy” rating
Taking into account the contraction of expenses and the significant drop in the purchase price of green vegetables, we raised our previous profit forecast. It is estimated that the net profit attributable to the parent company in 21-23 years will be 740 / 98.8 / 1.24 billion yuan (previously 680 / 8.5 / 1.02 billion yuan), with a year-on-year increase of – 5% / 32% / 27%, and EPS of 0.84/1.10/1.36 yuan. The current stock price corresponds to 37 / 28 / 22 times of PE in 21-23 years, maintaining the “buy” rating.
