\u3000\u3 Shengda Resources Co.Ltd(000603) 317 Sichuan Teway Food Group Co.Ltd(603317) )
Event: Sichuan Teway Food Group Co.Ltd(603317) issued the draft restricted stock incentive plan for 2022. It is proposed to grant 11.97 million restricted shares to the incentive objects, accounting for about 1.59% of the total share capital of the company, of which 9.97 million restricted shares are granted for the first time, accounting for about 1.32% of the total share capital of the company. The first grant price is 10.96 yuan / share.
The scope of incentives has been expanded to effectively bind core talents. The total number of incentive objects granted for the first time in this incentive plan is 237, including directors, senior managers (4), middle managers and technical backbones (233) in the company (including subsidiaries). The assessment objectives of the two sales restriction lifting periods are: Based on the operating revenue in 2021, the growth rate of operating revenue in 2022 / 2023 is not less than 15% / 32.25% respectively, corresponding to the year-on-year growth rate of operating revenue in 2022 / 2023 is 15% / 15%. In July 2021, the company issued the stock option and restricted stock incentive plan for 2021, with a total of 140 incentive objects granted for the first time, and the assessment goal is to increase the operating revenue by 25% year-on-year in 2022. In contrast, the scope of this incentive plan is wider, and the unlocking goal is relatively conservative. We believe that the equity incentive plan is conducive to binding the core backbone interests, stimulating the enthusiasm of the team and helping the medium and long-term stable development of the company.
Weak consumption affects income, and the annual performance in 2021 is under pressure. Under the background of weak industry demand and weak dynamic sales as a whole, the company's sales revenue in 2021 is affected to a certain extent. The annual operating revenue is expected to be RMB 2.026 billion, with a year-on-year increase of - 14.34%, of which the operating revenue in 2021q4 is expected to be RMB 628 million, with a year-on-year increase of - 25.22%. In 2021, the company's performance is under pressure, and it is expected to realize a net profit attributable to the parent company of 179 million yuan, a year-on-year increase of - 50.96%, mainly due to: 1) the rise in the price of raw materials such as grease; 2) The company increased the promotion of free gifts to clean up the channel inventory; 3) The increase in the proportion of low gross profit customized meal adjustment business has changed the product structure; 4) The company sponsors music variety shows and employs brand ambassadors to continuously increase brand building. 2021q4 is expected to realize a net profit attributable to the parent company of 98.46 million yuan, a year-on-year increase of + 123.23%, and the promotion efforts are narrower than before.
Face the pressure and make positive adjustments. In 2022, young people will be ready to fight. In response to the rising cost, the company raised the price of two hotpot bottom products under haorenjia in mid October, including 12.5% for 228g of manual butter (slightly spicy) and 10% for 500g of manual butter (slightly spicy). In view of the long validity period of inventory, on the one hand, the company increases the promotion of free gifts, on the other hand, it requires the salesperson to check the dealer's inventory every month and put forward reasonable purchase suggestions according to the flow rate and margin of products. With the gradual digestion of channel inventory, the company may be able to pack light in 2022 and expect the company to gradually get out of trouble.
Profit forecast, valuation and rating: we maintain that the net profit forecast of Sichuan Teway Food Group Co.Ltd(603317) 20212023 is 179 / 301 / 397 million yuan respectively, corresponding to EPS of 0.24/0.40/0.53 yuan in 20212023. At present, the channel inventory level is low, but the demand is still weak. The current stock price corresponds to 54 times PE in 2022, and the valuation level is high, maintaining the "overweight" rating.
Risk warning: the dynamic sales of the product is less than expected; Price fluctuation risk of raw materials; Food safety risks.
