Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) (600809)
Key investment points
The strong momentum of blue and white is not reduced, and the annual performance is guaranteed
The company’s 2021q1-q3 revenue was 17.257 billion yuan, an increase of 66% at the same time; The net profit attributable to the parent company was 4.879 billion yuan, an increase of 95% at the same time; Deduct 4.875 billion yuan, an increase of 98% at the same time, and still maintain high growth. In the first three quarters, the revenue still maintained a high growth (77% in Q1, 73% in Q2 and 48% in Q3), and the net profit attributable to the parent company still maintained an increase of more than 50% (78% in Q1, 239% in Q2 and 53% in Q3). At the end of 2021q1-q3, the contractual liabilities were 3.821 billion yuan, 1.134 billion yuan, and the annual performance was completed. The liquor revenue in 2021q3 was 5.115 billion yuan, up 48%, of which the Fen Liquor revenue in 2021q3 was 4.731 billion yuan, up 51%, accounting for 92.51%. We expect the growth rate of Qinghua Series in the third quarter to exceed 50%; the liquor revenue was 183 million yuan, up 54%, accounting for 3.59% ； The revenue from wine allocation was RMB 199 million, a decrease of 2% at the same time, accounting for 3.90%.
Nationalization is progressing smoothly, and the effect is beginning to appear in the south of the Yangtze River
The company’s revenue in 2021q1-q3 is 6.855 billion yuan in the province and 10.271 billion yuan outside the province, with a proportion of 4:6 inside and outside the province. It is expected to reach 3:7 during the 14th Five Year Plan period, when deep nationalization is in progress; Among them, the revenue in 2021q3 province was 2.138 billion yuan, an increase of 41% at the same time; The revenue outside the province was 2.977 billion yuan, an increase of 53%. Since the implementation of 1357 national layout, the company has dispatched elite soldiers and strong generals to the south of the Yangtze River, such as the Yangtze River Delta, the Pearl River Delta and the two lakes, put blue and white series and Bofen in key areas for basic and high-end people, and invested more brand resources for consumer cultivation. The current effect is beginning to show, and the company’s brand strength has been significantly improved.
Five highlights of the company in the future, and the reform will be further deepened
Looking forward to next year, although the company’s performance slows down, its revenue is expected to maintain a growth rate of more than 25%. After the national reform in 2017, the company is rejuvenated in the second spring, and the brand revival is imminent. It is just around the corner to become maowufen.
We believe that the company’s five highlights in the future: 1. Build a 2 + 2 brand. The first 2 refers to Fenjiu and Zhuyeqing, and the second 2 refers to Xinghua village brand and series brand. Fenjiu and Zhuyeqing core drive the development of the company, and Xinghua village brand and series brand are beneficial supplements. 2. It is a big health industry platform with bamboo leaf green as the core. Bamboo leaf green is a core brand built by the company in the future, and is expected to be large in the future. 3. Under the product strategy of “grasping both ends and strengthening the waist”, the blue and white series continues to enhance the brand strength of the company. The blue and white 30 · revival version seeks to bring large quantities of single products at a price of 1000 yuan, and Bofen consolidates the large single products at a price of 40-60 yuan, so as to strengthen the competitiveness of waist old Baifen and Panama products. 4. The “1357” nationwide layout is implemented for regional expansion, and the marketing organization structure of 31 provinces and regions + 10 directly subordinate management areas is gradually built. During the 14th Five Year Plan period, the proportion of revenue inside and outside the province is expected to increase from the current 4:6 to 3:7 in the future. 5. With the gradual completion of the company’s layout, the optimization of product structure and the deepening of national layout, the company’s net interest rate under the scale effect is expected to increase from more than 20% at present to more than 30% in the future.
Profit forecast
At present, the company’s brand potential continues to be released, focusing on building the revival version of blue and white 30 and entering the high-end wine camp. We are optimistic about the revival of the company’s brand. Blue and white lead the height of the company’s brand. It is expected that the EPS will be 4.65/6.28/8.40 yuan from 2021 to 2023, and the current share price corresponding to PE will be 65 / 48 / 36 times respectively. It will be covered for the first time and given a “recommended” investment rating.
Risk statement
Macroeconomic downside risks and epidemic situation drag down consumption; The growth of blue and white was lower than expected; The expansion outside the province was less than expected.
