[market week review and northbound monitoring]
This week, the value of CITIC Baijiu rose 5.50%, less than 5.55% of CITIC food and beverage, 2.59% higher than the Shanghai Composite Index, or the top 3 stocks were Hebei Hengshui Laobaigan Liquor Co.Ltd(600559) , Anhui Kouzi Distillery Co.Ltd(603589) and Xinjiang Yilite Industry Co.Ltd(600197) , or the last 3 stocks were Beijing Shunxin Agriculture Co.Ltd(000860) , Luzhou Laojiao Co.Ltd(000568) and Jiugui Liquor Co.Ltd(000799) . The net capital inflow from going north this week was 9.894 billion yuan. The top three stocks with net capital inflow were Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , and the bottom three stocks with capital inflow were Anhui Yingjia Distillery Co.Ltd(603198) , Xinjiang Yilite Industry Co.Ltd(600197) , Beijing Shunxin Agriculture Co.Ltd(000860) .
[investment perspective]
Baijiu Baijiu has been focusing on the opportunities of high-end liquor. The logic of this week has been verified, and the trend of high-end Baijiu plate is strong. Currently, the high-end liquor sector is still pushing ahead. We propose that the liquor business has strong barriers to the Baijiu plate and high-end Baijiu, and the business model has the superiority. The performance stability in 2022 is still strong, and the valuation is at a reasonable position. The core logic of the high-end sector is the price increase. We believe that the ability of high-end Baijiu enterprises to raise prices has always been there. Enterprises steadily increase their prices according to their own development rhythm, which is the way to long-term development.
This week, the secondary high-end rose significantly, and liquor enterprises such as Laobaigan, Anhui Kouzi Distillery Co.Ltd(603589) , Xinjiang Yilite Industry Co.Ltd(600197) performed well. We believe that the increase of the secondary high-end is mainly due to the valuation repair caused by the previous pessimistic Mid Autumn Festival and national day market. It is expected that the stock preparation for the Spring Festival is relatively optimistic. Coupled with the dealer conference at the end of the year and the price control of various wine enterprises, Q1 is expected to have a good start, but it is expected that the sustainability of the good market is not strong.
We maintain a neutral and cautious attitude towards the sub high-end sector as a whole. We suggest paying attention to Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) where the current valuation has a positive trend at the bottom and margin: the internal management is straightened out, and the most difficult period in the early stage of reform has long passed. The company’s business objectives next year are stable and not radical, and does not pursue the high growth brought by short-term pressure on goods. It is expected that the business performance will be better. At present, meng6 + has passed the cultivation period and entered the mature period. Since its listing in January, crystal dream is still in the cultivation period. It is expected to contribute more growth next year. We believe that non operating factors only suppress the valuation in the short term. At present, the company’s fundamentals are in an upward trend.
[recommended subject matter]
Suggestions: Wuliangye Yibin Co.Ltd(000858) , Kweichow Moutai Co.Ltd(600519) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304)
Risk warning: the price of terminal products is disorder, the backlog of channel inventory is too heavy, the actual sales are not as good as expected, the brand operation is not enough, and the price of liquor can not be raised smoothly, and the epidemic situation has repeatedly affected the normal consumption of Baijiu.
