Jason Furniture (Hangzhou) Co.Ltd(603816) (603816)
Key investment points
Effectively respond to tariffs and anti-dumping, and benefit the improvement of export profit margin and market expansion
We believe that: (1) in the short term, the Mexican base will help the company effectively deal with sofa tariffs and mattress anti-dumping. At present, the company's Vietnam factory can only cover its business to the United States (accounting for about 20% of the total revenue), 30% - 40% of the rest of the production capacity is under the pressure of additional tariff. Although it is shared through negotiation with customers, it still bears the tax burden of about 10%. The new factory will improve the coverage and reduce the company's profit loss caused by tariff / anti-dumping. (2) in the long run, Mexico base will help the company increase the production of high-end SKUs, consolidate its export position and improve its market share.
Build an intelligent digital chemical plant to improve supply efficiency and customer satisfaction
The new project relies on new technologies such as big data, Internet of things, cloud computing and AI / VI to build an intelligent digital chemical plant and realize the intelligent control of the whole household production process. It is expected to optimize the cost structure, improve the production & supply efficiency and shorten the delivery cycle, so as to effectively improve customer satisfaction. In addition, the company continues to streamline SKU and standardize the size of the supply chain. Logistics cooperation was carried out with Suning in 18 years, and the central warehouse was established in 19 years to realize unified distribution and reduce the inventory pressure of dealers, At the end of the 20th century, Huawei joined hands to open up the "end-to-end" process in the supply chain in an all-round way. The channel end regional retail operation companies are empowered in marketing, training and opening stores, and the information store coverage rate reaches 100%, which will effectively improve the channel efficiency and accumulate the competitive advantage in the second half.
The organizational structure continues to upgrade, the domestic operation is retail, and the long-term performance growth momentum is abundant
1) In October, the company carried out in-depth adjustment of the management team (more than 1 / 3 post change), focusing on the improvement of the organizational capacity of the middle and Taiwan: the main direction is ① the in-depth integration of foreign trade, production, research and marketing, and the value of human and property; ② the establishment of the middle and Taiwan Products Division (assessed separately) to be responsible for the improvement of the product capacity of various categories. During the adjustment period in October, the company's operation was not affected and showed Organizational Resilience..
2) The retail format of front-end comprehensive stores has been continuously promoted: at present, there are 93 stores above 2000 square meters (more than 30 in 20 years), and the proportion of integrated orders of customization and software is high (35%), which can be presented on the same design software, the integration of orders and delivery can be realized, the gross profit margin has reached the first-line leading level, and the profitability of dealers is strong.
3) Focus on retail Digital Construction: enhance brand exposure, cross regional Wuxi Online Offline Communication Information Technology Co.Ltd(300959) diversion, empower store managers & shopping guides, and cultivate private traffic through "cloud + pipe + platform". Although the real estate cycle suppresses the marginal order growth, the home head brand can counter the interference of passenger flow through the full flow card.
Profit forecast and valuation
On December 14, the company also announced Haitong asset management (holding 5.06%) in the three months since 1.7, the company has reduced its holdings by 1% through centralized bidding. The reason for the reduction is that the products need to be cashed when they are due. We believe that the disturbance of short-term capital will not change the long-term layout value of the company. The family actively promotes the integration of software + customization, and the channel system moves from wholesale to retail. It is a leader in high-quality consumer goods with a compound growth rate of 25 +% in the next three years. We It is estimated that the company will realize revenue of 18 / 226 / 27.8 billion yuan respectively in 21-23 years, with a year-on-year increase of 42.45% / 25.29% / 22.99%; The net profit attributable to the parent company was RMB 1.703/2.187/2.708 billion, with a year-on-year increase of 101.37% / 28.46% / 23.81%. The current market value corresponding to PE in 21-23 years is 25.98x/20.23x/16.34x respectively, maintaining the "buy" rating.
Risk tip: channel construction fails to meet expectations, and real estate regulation exceeds expectations
