Market review: this week (February 21-25, 2022), the weekly decline of Shenwan food and beverage industry was – 3.89%, which was greater than the decline of CSI 300 by – 1.67%; Among them, the snack (Shenwan class III, the same below) (1.98%) sector led the increase in Shenwan class III food and beverage sectors; The three sectors of Baijiu (-4.84%), health food (-4.13%) and beer (-4.01%) rank the top three in Shen Wansan’s food and beverage sectors.
Baijiu: “14th Five-Year” started smoothly, and the second high-end grew rapidly. Looking back to the first year of 2021, the first three years of the year saw that the Baijiu liquor enterprises achieve a good growth in the first quarter of the year, and the whole year is expected to achieve a steady conclusion in the year of 14th Five-Year. By enterprise category, the performance of high-end liquor enterprises represented by Maotai, Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) and Luzhou Laojiao Co.Ltd(000568) increased steadily during the year; The sub high-end liquor enterprises represented by Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Shede Spirits Co.Ltd(600702) , Jiugui Liquor Co.Ltd(000799) benefited from the accelerated expansion of sub high-end prices and regional expansion. The performance of the first three quarters of the first half of the year achieved significant growth. In the off-season of the fourth quarter or slowed down, the growth was benign by digesting channel inventory and controlling volume and price; The revenue of regional leading liquor enterprises represented by Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Gujing Distillery Company Limited(000596) , Anhui Yingjia Distillery Co.Ltd(603198) has increased steadily, benefiting from the continuous upgrading of regional market consumption in Jiangsu and Anhui, and the significant upgrading of the structure of leading products of Jiangsu liquor and Anhui liquor, which has driven the profit growth of regional leading liquor enterprises faster than the income growth.
Popular products: 2021q4 is significantly improved month on month, and focus on 2022 high elasticity standard. Subject to the epidemic situation, weak consumer consumption and rising cost, the overall operation of popular products is under pressure in 2021, but some industry trends continue, such as the high-end beer industry, the leading enterprises of advantageous beer have achieved rapid profit growth, and are still expected to accelerate in the future. Since the second half of 2021, the mass products industry has collectively raised prices, such as beer, condiments, quick-frozen and leisure snacks. At the same time, the channel inventory has eased and the consumption scene has been repaired. We expect that the performance of some enterprises in 2021q4 will improve month on month. At the same time, with the increase of product prices and the slowdown of cost pressure, the performance in 2022 will be more flexible. It is suggested to pay attention to condiments, quick-frozen Leading enterprises in leisure and snack industries. The demand of some sub industries is relatively stable, the enterprise operation shows strong toughness, and the allocation value is high under reasonable valuation. Dairy products are recommended.
Investment suggestion: Baijiu “14th Five-Year” is running smoothly, and it is estimated that the consumption upgrading trend will remain unchanged in 2022. By raising the price of popular products to cover the upward pressure on the cost, consumer demand is expected to gradually recover, and focus on the improvement of profits in 2022. Configure three main lines and focus on the regional leaders of undervalued value, high certainty and marginal improvement. Recommendations: Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) , Anhui Kouzi Distillery Co.Ltd(603589) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Shede Spirits Co.Ltd(600702) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , etc.
Risk tips: 1) repeated epidemics: the recovery progress of offline consumption scenes such as catering due to epidemic constraints is lower than expected: the epidemic is distributed in many places in China. If it lasts longer than expected, it may affect the subsequent performance of the food and beverage industry; 2) Intensified industry competition: intensified industry competition will increase the promotion expenses of enterprises and ultimately affect the profitability; 3) Food safety incidents: there are many links in the food processing process. If there are product quality and safety problems, they may have a certain impact.
