Baijiu is expected to maintain good growth, Chongqing Fuling Zhacai Group Co.Ltd(002507) performance exceeded expectations.
From February 21 to February 25, the food and beverage index fell by 3.9%, ranking 24th in the primary sub industry, about 2.2pct lower than Shanghai and Shenzhen 300. This week, for geopolitical reasons, the market has strong risk aversion. With the superposition of epidemic situation, the consumption of Baijiu based food and beverage decreased more. We are not pessimistic about baijiu. Before the Spring Festival, the manufacturers return the money according to the rhythm. After the festival, some wine enterprises appeared small batch replenishment. The current channel inventory is generally at a reasonable low level. It is expected that most of the liquor companies in the quarterly report will have a strong growth. From the impact of the epidemic on Baijiu in 2020 and 2021, Baijiu consumption will usually rebound strongly after the epidemic is effectively controlled. From the perspective of the whole year, high-end and some sub high-end brands are still expected to maintain good growth Wuliangye Yibin Co.Ltd(000858) personnel landing. Chairman Zeng’s style is steady, which is conducive to the improvement of decision-making efficiency and the company’s focus on market-oriented reform. It is expected that price support measures will be introduced in the future. Once the Wuliangye Yibin Co.Ltd(000858) approval price rises, the price space will be opened, which will be substantially beneficial to Guojiao and sub high-end brands. The current valuation has reached a reasonable interval. We still prefer the following market of Baijiu, and recommend Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) and Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) .
Chongqing Fuling Zhacai Group Co.Ltd(002507) released the performance forecast for 2021. The performance of 2021q4 exceeded expectations, which was mainly related to the active preparation of goods through the price increase channel in November. The company’s spring festival goods preparation rhythm in 2022 is normal, and the target is expected to be basically completed. Although the high base may weaken the year-on-year growth rate, it may still have a higher growth compared with the preparation for the Spring Festival in 2020. We analyzed the reasons for the profit growth in the fourth quarter: first, the price increase in November made a positive contribution to the gross profit margin; Second, the consumption recovered in the fourth quarter, and the market cost investment converged after the demand increased. We judge that condiments in the fourth quarter may generally have the common characteristics of good price increase and convergence of cost investment. In 2022, the company has a high probability of increasing its profit margin. The main sources are as follows: first, the effect of price increase at the end of the year should appear throughout 2022; Second, the purchase price of qingcaitou, the main raw material, was basically determined, and the cost decreased significantly year-on-year; Third, considering that the annual cost rate may shrink accordingly after the reduction of ladder media advertising. It is expected that the improvement of profit margin is highly deterministic, and the performance release has a band market. It is expected that the profit of statements in the second or third quarter may grow high, so it is recommended to actively participate.
Recommended combination: Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Foshan Haitian Flavouring And Food Company Ltd(603288) , Cabio Biotech (Wuhan) Co.Ltd(688089)
(1) Kweichow Moutai Co.Ltd(600519) cancel the unpacking policy of Feitian Maotai liquor, and the price difference between the original box and the bulk bottle is expected to narrow, which is conducive to the development of marketization. The price increase of Maotai liquor is expected to rise. Considering the supply of base liquor, the planned revenue target is expected to accelerate in 2022. The company has room to move calmly in terms of volume and price, and the logic of simultaneous rise of volume and price in the future is smooth. (2) Wuliangye Yibin Co.Ltd(000858) recently, the wholesale price has rebounded, the channel inventory is low, and the shipment is stable compared with the previous period. Considering the changes of quotas inside and outside the plan, it is expected to achieve double-digit growth in 2022. (3) Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) in the fourth quarter, the goods were strictly controlled and the delivery of superimposed expenses was accelerated, resulting in a slowdown in revenue and a decline in net interest rate. In 2022, the company firmly pursues higher quality development. It is expected that the product structure will be significantly improved and the annual performance will maintain rapid growth. (4) Foshan Haitian Flavouring And Food Company Ltd(603288) the price increase has a positive impact on costs and channel profits. The condiment industry is slowly repaired, and the company also shows a recovery trend. Considering the price increase, it is expected to return to the normal growth level in 2022. Proposed layout and long-term holding. (5) Cabio Biotech (Wuhan) Co.Ltd(688089) : equity incentive is implemented. After the implementation of the new national standard, the milk powder industry will start a new round of formula upgrading to accelerate the medium and high-end of the milk powder industry. The company is expected to fully benefit from the dividend of the new round of formula upgrading. At the same time, the second growth curve of SA is opened, and the cosmetics market is expected to relay.
Risk tips: economic downturn, food safety, fluctuations in raw material prices, lower than expected recovery in consumer demand, etc.
