\u3000\u3 China Vanke Co.Ltd(000002) 311 Guangdong Haid Group Co.Limited(002311) )
The volume of “one body and two wings” increased, the profit increased, the pressure on the breeding business weakened, and the “buy” rating was maintained
Guangdong Haid Group Co.Limited(002311) released the annual performance express of 2021: the company’s revenue in 2021 was 86.74 billion yuan (+ 43.8%), and the net profit attributable to the parent company was 1.6 billion yuan (- 36.5%). During the reporting period, the company’s non pig business realized a profit of 2.6 billion yuan, a year-on-year increase of 38%, including a net profit of 2.3 billion yuan from feed business and a net profit of more than 100 million yuan from animal insurance and seedling business; The net profit loss of pig business is RMB 900-1 billion. The decline of pig price in 2021 dragged down the realization of the company’s overall profit and lowered the forecast for 2021; Since 2021h2, the company’s piglet seedling cost has decreased. It is expected that the negative drag of the company’s pig breeding business will be greatly reduced in 2022, and the profit forecast for 20222023 will be slightly adjusted. It is expected that the net profit attributable to the parent in 20212023 will be RMB 1.60/30.6 billion (the previous forecast value was RMB 1.74/30.5/6 billion), the corresponding EPS will be RMB 0.96/1.84/3.61 respectively, and the current share price corresponding to PE is 65.6/34.3/17.5 times, Maintain the “buy” rating.
The feed business maintained high growth, and the company’s industrial chain integration advantage was prominent
In 2021, the company sold 18.77 million tons of feed (+ 30%), and consumed 860000 tons of internal breeding. In 2021, the price of feed raw materials was adjusted at a high level, and the breeding of pigs and poultry was at a low cycle, resulting in a two-way squeeze on the profits of the feed industry. In this process, the company’s industrial chain integration advantages are prominent. On the one hand, the company has increased the investment in seedlings, animal protection and the layout and construction of breeding service stations, further upgraded the service system, and continuously enhanced the viscosity of feed delivery of farmers; On the other hand, the profit of small feed enterprises is thin, the capital pressure is prominent, and there is an accelerated exit trend. At this stage, the company accelerates the integration of small and medium-sized production capacity in South China and North China, and the regional market share continues to increase, laying a solid foundation for achieving the sales target of 40 million tons of feed (including domestic sales) in 2025.
The pressure of breeding business tends to dissipate, and the reversal of pig price cycle will make a positive contribution
In 2021, the company sold about 2 million pigs, and about 1.3 million pigs were purchased for fattening, accounting for more than 60%. The high total cost of pigs in 2021 is mainly caused by the high seedling cost. We estimate that at present, the cost of the company’s self breeding piglets is about 500 yuan / head. In 2022, the seedling cost of fattening pigs will decrease significantly year-on-year. In addition, the advantages of the company’s feed formula and cost, and the gradual maturity of the breeding personnel system will drive the reduction of cost amortization. It is expected that the company’s pig marketing cost will be reduced to less than 17 yuan / kg in 2022. The negative impact of pig breeding business on the company’s overall profit realization will weaken, and with the cycle reversal, it will bring positive performance contribution.
Risk tip: the decline range of feed raw material price, the length of loss cycle of pig breeding industry, etc.
