Shanghai Bairun Investment Holding Group Co.Ltd(002568) (002568)
Successfully create a home drinking scene and lead the secondary rise of Rio. The rapid growth of Rio sales from 2013 to 2015 and the rapid decline thereafter are more like “online popularity” phenomenon formed by strong brand marketing. Since 2019, the key to Rio’s secondary rise is to successfully shape the consumption scene of drinking alone at home and create a slightly drunk series. The success of Weixun series is not the accidental popularity of a single product series, but involves the shaping of consumption scenes, fine marketing of sub brands, rhythmic new product R & D and listing, and the systematic improvement of steady channel coverage.
Rio’s growth period is far from over, and its development path is clearer. Drawing on the experience of Japan, there is still much room for expansion in China’s low alcohol wine market. Rio’s development path is to carry out sub brand layout, scene education and product penetration around core consumers by age. We believe that Weijiu series positioned at the age of 18-23 will maintain rapid growth by continuing to increase channel coverage and product iteration; The refreshing series, which is positioned at a higher age, is now in the stage of channel distribution. With the help of high cost performance and consumer cultivation of bubble drinks, it is expected to achieve rapid development; The company has launched new categories of plum wine and reserved highball and foreign wine. The diversified development path of categories is gradually clear. Combined with channel penetration and regional coverage, the growth stage of Rio is far from over.
Industry competition is benign. Since 2h19, the number of competitors in the industry has increased, but they are generally cautious, which is reflected in the blooming of low alcohol wine segments, avoiding the positive competition with Rio in the field of pre mixed cocktails. We believe that most entrepreneurial brands do not have long-term development potential. The cross-border entry of large beverage and wine enterprises is more to expand the product line than systematic and vigorous investment, and there is no threat in the short term. In the field of low alcohol wine, Rio still has a deep moat.
Profit forecast: it is estimated that the total revenue of the company from 2021 to 23 will be RMB 2.71/3.58/4.6 billion, and the net profit attributable to the parent company will be RMB 8 / 10.4/1.329 billion, eps1.5% 05 / 1.33/1.69 yuan. The share price of 2021 / 12 / 9 is 68.22 yuan, corresponding to 51 times of P / E in 2022. We believe that the company is still in the early stage of growth, covering for the first time, and give an overweight rating.
Risk warning: the sales of new products are less than expected; Intensified market competition affects short-term sales; Food safety incidents.
