Zhengzhou Qianweiyangchu Food Co.Ltd(001215) (001215)
Quick frozen noodle rice is a leading enterprise, based in East China and expanding inland
The company focuses on the R & D, production and sales of quick-frozen noodles and rice products for catering enterprises, mainly engaged in fried products, cooking products, baking products and dishes. The company deeply binds large chain restaurant enterprises such as Yum China, Wallace, jiumaojiu, zhenkung Fu and Haidilao through the direct marketing end; The distribution side penetrates the market of low thread group meal, takeout and rural kitchen through dealers, and gradually penetrates inland from the coast of East China.
The demand for cost reduction and efficiency increase in the catering supply chain is urgent, and the third-party central kitchen has a wide penetration space
The high procurement cost, high labor cost, high rent cost and low gross profit margin in the catering industry lead to intensified competition and high bankruptcy rate. The improvement of downstream chain rate, the huge market space of group meal of RMB 1.53 trillion, the rapid expansion of takeout market and the sinking demand of rural kitchen market all provide a broad market space for the catering supply chain that can reduce costs and improve efficiency. The quick-frozen food that naturally adapts to standardized production, can effectively reduce the meal preparation time, reduce the back kitchen area and staffing, and reduce the cost of food materials has become the solution. According to the calculation, the third-party kitchen that supplies quick-frozen food as a meal enterprise can improve the profit rate of 9.1-14.5pcts. At present, the penetration rate of quick-frozen food in China is only 36%, compared with 60% in Japan in the 1980s.
It is only the choice of catering kitchen, and multi-dimensional casting competitive advantage
By providing semi-finished products of quick-frozen noodles and rice, the company has become the third-party central kitchen of food enterprises. It starts at the B end first and attracts high-quality chain food enterprises through the lighthouse effect of large B customers at the direct end; Dealers penetrate the sinking group meal, rural kitchen and takeout market in low-level cities; From March to June, rapid research and development to provide technical moat; The production expansion of raised investment projects provides capacity support and comprehensively improves the market share in four dimensions. It is the dual attribute scarce target of “Chinese quick frozen noodles + catering supply chain solution” with long-term competitive advantage. In the future, with the further expansion of the scale of direct customers, the expansion of new customers and the continuous increase of the number of distributors and single point potential energy at the distribution end, the company will continue to obtain performance growth potential energy.
Investment advice and profit forecast
The company relies on perfect supply chain, strict whole process quality control mechanism and rapid corresponding R & D ability to provide cost reduction and efficiency improvement solutions for food enterprises. The industrialization reform of the b-end catering market has brought broad space. The company has increased the price through the direct marketing end and opened the sales volume through the distribution end, so as to realize the simultaneous increase of volume and price and expand the revenue. The concentration of the fast-frozen noodle rice catering industry is low. After the company is listed, it is expected to accelerate the development of direct and distribution customers and improve the market share by expanding production and breaking through the capacity bottleneck. Considering the high certainty of the company’s direct customers and distributors in the medium and long term growth, we predict that the company’s EPS will be 1.05/1.39/1.77 from 2021 to 2023, and the corresponding current price PE will be 61 / 46 / 36x respectively. It will be covered for the first time and given a “buy” rating.
Risk statement
The risk of food safety events, the risk of intensified industry competition, the risk of rising raw material prices, and the capacity construction and climbing are not as expected
