\u3000\u3000 Chongqing Fuling Zhacai Group Co.Ltd(002507) (002507)
Event: the company disclosed the performance express of 2021, and it is expected to realize an operating revenue of 2.519 billion yuan in 2021, 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%; Deduct 694 million yuan of non parent net profit, a year-on-year increase of - 8.50%. 21q4 is expected to achieve an operating 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 + 45.73%; Deduct the net profit not attributable to the parent company of 209 million yuan, a year-on-year increase of + 32.40%. Revenue met expectations and net profit exceeded expectations.
Revenue growth remained stable and channel inventory improved. In 2021, the revenue increased by 10.82% year-on-year, which was generally stable. The revenue of 2021q4 company increased by 18.74% year-on-year, which was mainly due to the company's announcement on November 15, 2021 that the ex factory prices of some products were adjusted, and the increase range of various categories was 3% - 19%. After the price increase, the retail price of main product circulation channels entered the era of 2.5 yuan. As an industry leader, Chongqing Fuling Zhacai Group Co.Ltd(002507) has little resistance to price increase. According to channel and grass-roots research, there are few promotional activities and no shopping guides. The early price increase is gradually reflected in the terminal price, and the age of goods is relatively benign. In terms of channel inventory, after the price increase, the delivery speed of dealers is accelerated. According to channel research, the inventory level of dealers at the end of the year fell to the low level in recent years. The price increase of the company also increased the channel profits of dealers, stimulated the enthusiasm of dealers, and the overall price transmission was relatively smooth, which was smoothly reflected in the growth of revenue.
Price increase + fee reduction work together to promote Q4 profit growth. In 2021, the net interest rate decreased by 4.73pct to 29.46% year-on-year. In the fourth quarter of the year, the company achieved a net interest rate of 42.30%, a year-on-year increase of 7.84pct, a month on month increase of 21.35pct, and the profit margin increased significantly. The main reasons are as follows: 1) the effect of price increase: after the price increase, the profit space of the company opened, hedged the cost pressure brought by the high price green vegetables, and the report dividends gradually fell to the ground, realizing the rapid increase of profit margin. 2) Reduction of advertising expenses: the company invested heavily in marketing expenses in the first three quarters, with an advertising expense rate of about 10-11%. The advertising expenses of Q4 company decreased month on month compared with the first three quarters, further increasing the net interest rate. 3) Q4 financial management interest income brings certain non recurring profits and losses.
Diversified development of categories, continuous sinking of channels, and expected growth in 2022. In 2022, the focus of the company will shift from the main business of pickled mustard to diversified and multi category development. The product end will focus on new products such as radish and pickle. Given that the company has the advantages of channel and brand as a leader in the pickle industry, we expect that the new products are expected to open up market space and achieve rapid growth in 2022. At the channel end, according to the channel research, the company has built more than 10 new offices, continued to promote the channel sinking, established the second catering department, and established the b-end channel with offices in the provincial capital city. With the continuous promotion of price increase and the continuous expansion of categories, the revenue side is expected to rise both in volume and price. In addition, the high-cost qingcaitou has been gradually digested. This year, the purchase price of qingcaitou has dropped to 800 yuan / ton, the cost pressure has slowed down, the marginal reduction of sales expense rate has been superimposed, and the elasticity of profit side can be expected.
Investment suggestion: the company's earnings per share from 2021 to 2023 are expected to be 0.84/1.11/1.33 yuan respectively. It is given a Buy-A investment rating and a six-month target price of 38.75 yuan, which is equivalent to the dynamic P / E ratio of 35x in 2022.
Risk tip: the continued weak demand for mass products affects the recovery and acceleration of sales; Channel sinking and new channel development progress are less than expected; Category expansion was less than expected
