\u3000\u3 China Vanke Co.Ltd(000002) 507 Chongqing Fuling Zhacai Group Co.Ltd(002507) )
On February 24, 2022, the company announced the performance express of 2021. It is estimated that in 2021, the annual operating revenue will be 2.519 billion yuan, with a year-on-year increase of 10.82%, and the net profit attributable to the parent company will be 742 million yuan, with a year-on-year decrease of 4.53%. After deduction, the net profit attributable to the parent company will be 694 million yuan, with a year-on-year decrease of 8.50%. According to this calculation, in the fourth quarter of 2021, the company achieved an operating revenue of 563 million yuan, a year-on-year increase of 18.74%, and the net profit attributable to the parent company was 238 million yuan, a year-on-year increase of 45.74%.
The annual performance was stable and improved significantly in the fourth quarter. In 2021, the company’s annual revenue is expected to increase by 10.82%, mainly due to the steady growth of pickled mustard sales, the net profit attributable to the parent decreased by 4.53%, and the net interest rate decreased by 4.73pct to 29.46%, mainly due to the rise in the price of first-class raw materials of green vegetables, and the company increased advertising investment for brand construction, resulting in a significant increase in sales expenses. In the fourth quarter, under the effect of price increase, the growth of the company’s revenue accelerated 17.44pct to 18.74% month on month. At the same time, the investment of expenses was more accurate, and the financial income of idle raised funds also brought additional profits. The net profit increased by 45.74% year-on-year, and the profit improved significantly. The net interest rate in a single quarter reached the highest in history of 42.27%.
Raise prices and reduce cost control fees, and high flexibility can be expected in 2022. The cost of the company’s main raw material green vegetable head in 2021 is about 1100 yuan / ton, and the purchase price in the new procurement season in 2022 is about 800 yuan / ton. The cost has decreased significantly. Considering the production cycle, the cost side decline is expected to be gradually released in the second half of 2022. Since November 12, 2021, the company has increased the ex factory price of some products by 3% – 19%. Considering the consumption attribute of mustard itself, the impact of price increase on sales is controllable, and the price increase will increase the company’s profit. In 2021, the company carried out brand publicity by inviting spokesmen and increasing advertising, which greatly increased the sales cost. It is expected that the cost investment in the future will be more reasonable and efficient. Under the condition of price increase and cost control, the performance in 2022 is highly flexible and can be expected.
Increase the capacity expansion of fixed size, and many categories have development potential. As of the first half of 2021, the company’s existing production capacity of various categories totaled 223.25 million tons, the production capacity of 50000 tons of radish in the northeast base of the company will gradually reach the production capacity, and the raised investment of 200000 tons of pickled mustard will expand the production capacity of the company to more than 450000 tons. With the improvement of residents’ consumption ability and consumption awareness, the packaging rate of pickled mustard is expected to increase steadily. As the leader of pickled mustard industry, the company focuses on “clarifying the value of pickled mustard and making hot Wujiang brand”, and has long-term development potential.
Investment suggestion: according to the company’s performance express, we adjusted the company’s performance forecast from 2021 to 2023. It is estimated that the company’s operating revenue from 2021 to 2023 will be 2.519 billion yuan, 2.936 billion yuan and 3.273 billion yuan respectively, the net profit attributable to the parent company will be 742 million yuan, 933 million yuan and 1.056 billion yuan respectively, and the EPS will be 0.84, 1.05 and 1.19 yuan respectively. The current share price corresponds to 41, 33 and 29 times of PE respectively, maintaining the “recommended” rating.
Risk tip: the epidemic has repeatedly affected residents’ consumption, intensified industrial competition, sharp rise in raw material prices, and food safety accidents.
