Jiugui Liquor Co.Ltd(000799) (000799)
High growth in the first three quarters, leaving room for 2021q4
The company’s total revenue from 2021q1-q3 was 2.640 billion yuan, an increase of 134% at the same time; The net profit attributable to the parent company was 720 million yuan, an increase of 118% at the same time. Among them, the total revenue of 2021q3 was 926 million yuan, an increase of 129% at the same time; The net profit attributable to the parent company was 210 million yuan, an increase of 43% at the same time; Deduct non RMB 209 million, an increase of 132% at the same time. Benefiting from the low base in the same period last year, the revenue and profit growth of the companies in 2021q1 and Q2 basically doubled, and the company is likely to continue to rise. The company’s contractual liabilities at the end of 2021q1-q3 were 521 million yuan, an increase of 189 million yuan, leaving room for the fourth quarter, and the completion of the annual performance is guaranteed.
The potential energy of internal reference has been raised in the past three years, and the drunkard series is facing high growth
The revenue of internal ginseng in the first three quarters was 750 million yuan, doubling year-on-year; The revenue of drunkard Series in the first three quarters was 1.54 billion yuan, which also doubled year-on-year. In 2021q3, momentum of the participating in drunkard series continues unabated and continues to maintain high growth. Looking back on the development of internal reference, since the establishment of the internal reference sales company since the end of 2018, the internal reference has been enjoying a high growth rate under the support of the COFCO support and channel business. We expect the annual sales of the internal reference company to be around 1 billion 600 million yuan, and the target is estimated to be around 3 billion yuan next year. The company intends to build the internal reference into “fourth high-end Baijiu“. Drunkard series benefited from the low base in the same period last year and the company’s launch of hongtan 18 and 20 in different regions inside and outside the province, and ushered in high growth this year. The drunkard series continues to move forward with the expansion of internal ginseng outside the province. In addition, the company’s cultural and creative products and internal products are useful supplements to the company’s products. The interior products are positioned in the wedding banquet market, with a blank price band of 200-300 yuan after the price increase of the main card drunkard series.
Internal parameters become the power engine, and the medium-term goal is imminent
After several years of operation and operation, the company has successfully gone out of the province, and the investment promotion layout outside the province continues. At present, the company’s advantageous regions are mainly in Beijing, Tianjin, Hebei, Shandong and Guangdong, and other regions need time to cultivate. East China is expected to become the company’s next granary. The company will take scale as an important assessment index in the next 3-5 years, in which the internal reference will play the role of power engine, and will go all out to sprint the short-term goal of 3 billion, medium-term goal of 5 billion and long-term goal of 10 billion, and the medium-term goal will be achieved soon. We expect that the product structure of the company in the future will be internal participation: drunkard series: Xiangquan = 4:5:1.
At present, the company’s management is stable, the company is the only liquor enterprise in COFCO Baijiu, and COFCO pays more attention to the company than before. Mr. Zheng Yi, vice general manager of COFCO liquor in the early stage, served as the vice chairman, general manager and chief financial officer of the company, which is expected to promote the progress of equity incentive of the company. At present, the company has pre arranged production capacity, expanded four production lines in production zone 2, and can increase the base liquor production capacity by 2000 tons / year after completion; It is proposed to invest 1.5 billion yuan to build phase II of zone III. after the completion of the project, the new base liquor production capacity will be 7800 tons / year, and the total production capacity will reach 22800 tons / year at that time.
Profit forecast
In the five years since COFCO took over, For the company’s brand side (emphasizing the best product · cultural drunkard, the positioning of the three brands is clear), the product side (the proportion of secondary high-end and above continues to increase, focusing on building three strategic single products), the price side (combing the product price system and comprehensively introducing the price control mode) and the channel side (internal reference equity dealer mode and Jiugui Liquor Co.Ltd(000799) Clarify the division of labor among manufacturers) to reshape, expand production capacity and ensure quality. In the 14th five year plan, the company will go all out to achieve the goals of 3 billion in the short term, 5 billion in the medium term and 10 billion in the long term. We are optimistic about the national expansion of the company’s internal participation. It is estimated that the EPS from 2021 to 2023 will be 2.98/4.61/6.39 yuan respectively, and the current share price corresponding to PE will be 76 / 49 / 36 times respectively. It will be covered for the first time and given a “recommended” investment rating.
Risk statement
Macroeconomic downside risks, the epidemic drag on consumption, the growth of internal participation is less than expected, and the expansion outside the province is less than expected.
