Wuliangye Yibin Co.Ltd(000858) (000858)
Key investment points
Focus on making up for weaknesses and move forward with six breakthroughs
The company’s 2021q1-q3 revenue was 49.721 billion yuan, an increase of 17% at the same time; The net profit attributable to the parent company was 17.327 billion yuan, an increase of 19% at the same time; Deduct non net profit of RMB 17.286 billion, an increase of 18.53% at the same time; Among them, the revenue of 2021q3 was RMB 12.969 billion, an increase of 11% at the same time; The net profit attributable to the parent company was 4.127 billion yuan, an increase of 12% at the same time; Deduct non net profit of RMB 4.152 billion, an increase of 11.61% at the same time, and continue to maintain steady growth. At present, the company’s weakness lies in that Wuliangye Yibin Co.Ltd(000858) brand value is still in a depression, cultural communication needs to be improved, some market basic work is weak, the transformation speed of marketing team is slow, a few dealers’ service awareness needs to be strengthened, service ability needs to be improved, and the profitability of some merchants does not meet expectations. From improving brand value, adhering to brand quality Plan from multiple dimensions such as overall channel management.
This year, the company made six breakthroughs: 1) new optimization of product structure. The eighth generation Wuliangye Yibin Co.Ltd(000858) of core large single products has achieved stable price and volume increase, the terminal dynamic sales has reached a new high, and the relationship between volume and price has been benign. The series liquor product system has become more focused, with the successful launch of new products such as wuliangchun and Jianzhuang 1911. The series liquor has more obvious focus on self owned brands, medium and high price brands and high-quality brands. 2) Brand promotion to achieve new breakthroughs. Relying on Wuliangye Yibin Co.Ltd(000858) core values, profound cultural heritage, raw grain, cellar, brewing and quality brand advantages, close to different consumption circles, carry out brand export activities from international China. 3) Channel construction has been upgraded. The traditional terminal channels were further optimized, the supply chain integration of Wuliangye Yibin Co.Ltd(000858) and series channels was steadily promoted, and the hyperfine services of national and regional merchants were steadily promoted. The group buying network was further improved, 70% of enterprises realized group buying, built a group buying network led by leading enterprises and covering 30000 enterprises across the country, and carried out special expansion in key markets such as Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Hangzhou, Nanjing and Zhengzhou to achieve good growth. 4) Consumption cultivation enhances new vitality. Carry out special personalized services for group purchase customers, further stimulate the consumption potential, hold tasting meetings, and steadily improve the reputation and activity of high-end consumption. The series of wines use online drainage and offline code scanning to promote consumers’ innovation and transformation, and loyal consumers gradually increase. 5) New progress has been made in digital transformation. Internally, establish a top-down sales index decomposition mechanism to promote the implementation of marketing actions in the whole process. Externally, the traditional business, innovative business and other marketing processes were incorporated into the online digital system, and the effect of digital empowerment appeared for the first time. 6) The relationship between manufacturers has reached a new height. Manufacturers work together to smooth communication channels, jointly provide evaluation and value-added services, jointly strengthen business learning, jointly improve quality and image, and jointly strengthen generation inheritance. The community of destiny is more stable.
Five major work priorities in 2022, brand product channel upward
Five priorities of the company in 2022: 1) adhere to the simultaneous development of culture and service, and continue to strengthen the cultivation of consumers. In 2022, the company plans to build 10 new cultural experience halls and put them into use to create an important position for the cultivation of opinion leaders and consumer circles. Focus on the 8th generation Wuliangye Yibin Co.Ltd(000858) and classic Wuliangye Yibin Co.Ltd(000858) , increase brand publicity, IP upgrade, increase strategic cooperation on international platforms, do a good job in the customization of cultural wine, and orderly promote the sales of customized wine, closed altar wine and group purchase. Do a good job in the services of opinion leaders and consumption circles and the customization of enterprise exclusive group purchase, build a stronger service distribution system, and optimize the one-to-one service for opinion leaders. 2) Adhere to the balance between supply and demand and continuously improve the market positioning of Wuliangye Yibin Co.Ltd(000858) . Adhere to consolidating the market core position of the eighth generation Wuliangye Yibin Co.Ltd(000858) thousand yuan price with large single products, continuously optimize the plan configuration, optimize the standard plan, expand the incremental plan, optimize the traditional channels, expand the group purchase channels, stabilize the traditional high-quality market, expand the high-level key markets, consolidate the market foundation, tap the market’s stable growth potential with high quality, and give priority to ensuring the demand for high-quality sales. We must persist in developing 2000 Baijiu market, strengthen the cultivation of classic Wuliangye Yibin Co.Ltd(000858) market, strengthen the 1+2+N channel mode, and make good use of the scarce resources of classic Wuliangye Yibin Co.Ltd(000858) , and distribute resources. Create a good market atmosphere and enhance the market position of classic Wuliangye Yibin Co.Ltd(000858) . 3) Adhere to the combination of personality and market, and continue to meet the consumer demand of the new era. Launch a series of old wine activities to expand the old wine market. We should continue to cultivate low consumption market, give full play to the advantages of low alcohol Baijiu and expand low stability. Stabilize the advantages of the main sales market and form a low-cost market awareness. In line with the new consumption demand of the new generation, focus on the development of fruit wine, special wine and other wine products, and moderately develop wine. 4) Adhere to both scale and value, and continue to promote the upgrading and development of series wines. Wuliangye Yibin Co.Ltd(000858) under the guidance of “three characteristics and one time” and “Three Focuses”, systematically implement the specific measures of “strengthening the national strategic brand, expanding the regional key brand and optimizing the general distribution brand”, concentrate on building four national new strategic products: wuliangchun, wuliangchun, wuliangtequ and Jianzhuang, and further optimize the volume price relationship as a strategic synergy, Promote the double promotion of brand value and market scale of series liquor. Strengthen the dynamic marketing of products, create a large single product of 1 / 20 / 3 / 5 billion, and strengthen brand building and expansion. Strengthen the construction of channel outlets and actively play the role of Ka and e-commerce image benchmark. 5) Adhere to sharing and co construction, and continue to build a Wuliangye Yibin Co.Ltd(000858) community of common destiny. Optimize the team’s business ability and service ability, and accelerate the transformation from “management” to “enabling” and “service” teams.
In 2022, we will continue to make progress while maintaining stability, and the brand potential will continue to rise
In 2022, the company will continue to do a good job in marketing, adhere to the general tone of seeking progress while maintaining stability, unswervingly focus on strengthening the main business of the wine industry, continue to promote transformation and innovation, deeply promote the long-term work policy of making up for weaknesses and lengthening the version, and lay out a new round of high-quality development. Adhere to the core of high-quality improvement, accelerate the construction of new manufacturer relations, strengthen supply chain stability, channel transformation and market expectations, and ensure the full realization of new development with steady progress.
Four highlights of the company in the future: first, the main brand “1 + 3” product system remains unchanged, continue to promote the established strategy, hold high and promote the development of classic Wuliangye Yibin Co.Ltd(000858) . Second, in terms of channels, the company continued to promote group purchase channels. Last year, the company took the initiative to develop group purchase channels, with a group purchase target of 30% in 2021. Third, in terms of liquor series, focus on resources to build four national strategic brands: Jianzhuang, wuliangchun, wuliangtequ, and strive for sales of more than 20 billion yuan during the 14th Five Year Plan Period: Jianzhuang’s target of 10 billion yuan, wuliangchun and wuliangchun’s target of 5 billion yuan, and wuliangtequ’s target of 2 billion yuan. Fourth, Maotai’s current rating is steadily above 2500 yuan. Next year’s Wuliangye Yibin Co.Ltd(000858) rating will stand firm. There is little problem with the price band of 1000 yuan. It is expected to continue to rise both in volume and price, with high performance certainty.
Profit forecast
At present, Maotai occupies a price band of more than 2500 yuan, which opens the ceiling for the price band of thousands of yuan at Wuliangye Yibin Co.Ltd(000858) station. We believe that the company has taken many measures to reform and improve the brand, products, prices and channels in recent years, which has achieved remarkable results and high market recognition. It is expected that the EPS will be 6.26/7.40/8.64 yuan from 2021 to 2023, and the current share price corresponding to PE will be 38 / 32 / 27 times respectively. It is covered for the first time, giving a “recommended” investment rating.
Risk statement
Macroeconomic downside risk, epidemic drag on consumption, less than expected classic Wuliangye Yibin Co.Ltd(000858) growth, less than expected upward rating, less than expected group purchase growth, etc.
