Key investment points
Core concern: the ticket unit price of Yiwu grain producing area increased year-on-year and month on month
The unit price of Yiwu ticket in key grain producing areas maintained double growth year-on-year. In terms of industry, the unit price of single monthly ticket in November 2021 was 9.49 yuan, a month on month increase of + 0.35 yuan, a year-on-year increase of -0.38 yuan. Among them, for the price wind vane in key grain producing areas, Yiwu (Jinhua) in November 2021, the unit price of express business ticket above the standard was 3.31 yuan, with a month on month increase of + 0.37 yuan and a year-on-year increase of + 0.25 yuan. Since February 2020, the same and month on month growth has been achieved for the first time. On the whole, the price increase in the peak season is smooth. In addition, in view of the low e-commerce consumption and the flat trough in the peak season, we expect that the growth rate of temporary cost investment of express enterprises is lower than that in previous years, so the probability of single ticket profit can rise significantly. Follow up suggestions focus on the end price trend after the peak season.
From the perspective of the company, the unit price inflection point of Longtou construction has been continuously increased from June to November. In November 2021, the unit price of SF ticket was 15.82 yuan, a month on month increase of – 0.63%; The unit price of Yunda ticket is 2.38 yuan, a month on month increase of + 9.68%, which is the only continuous month on month increase from June to November among the three A-share home appliance express enterprises; The unit price of round pass ticket is 2.59 yuan, a month on month increase of + 13.10%; The unit price of Shentong ticket was 2.46 yuan, a month on month increase of + 16.59%.
From the perspective of industry and company, the introduction of regulatory policies promotes the return of prices to a benign trend. It is suggested to pay attention to the price trend after the peak season.
Industry: the cumulative single volume in the first November increased by 32% year-on-year, and the year-on-year growth rate in December is expected to be about 15%
Single volume: the single volume in a single month increased by 16.51% year-on-year, and the cumulative single volume in the previous November increased by 32.31% year-on-year. In November 2021, the number of express orders in the industry was 11.332 billion, a year-on-year increase of 16.51%. In the first November, the single quantity of the industry was 98.048 billion, a year-on-year increase of 32.31%. According to the China Express development index report of the State Post Office in December 2021, the express business volume is expected to grow by about 15% in December, of which the postal express enterprises handled 460 million express pieces during the whole day of the 12th lunar new year, a year-on-year increase of more than 20%. E-commerce online shopping is still driving, with the superposition of express sinking (regional sinking and unit value sinking) and steady progress of express going to sea. We believe that the number of express orders in the industry is still expected to maintain a year-on-year growth of more than 20% in the next two years.
Revenue: in November, the express revenue was 107.490 billion yuan, a year-on-year increase of 12.04%. In November 2021, the monthly express revenue of the industry was 107.490 billion yuan, a year-on-year increase of 12.04%. From January to November 2021, the industry’s express revenue totaled 841.47 billion yuan, a year-on-year increase of 19.64%.
A-share target: Tongda’s single volume hit a record high, and pay attention to the leading volume and price trend
Single volume: from the market share of single volume in November, Yunda > Yuantong > Shentong > Shunfeng. SF’s single volume was 1.027 billion pieces, with a year-on-year market share of -0.25pts to 9.06%; Yunda has a single quantity of 1.883 billion pieces, with a year-on-year market share of + 0.35pts to 16.62%; The number of Yuantong orders was 1.745 billion, with a year-on-year market share of -0.42pts to 15.40%; The number of Shentong orders was 1.182 billion, with a year-on-year market share of + 0.02pts to 10.43%.
Pattern: observed by Cr4 index, the share is still concentrated to the leader. According to the express service brand concentration index CR8 released by the State Post Office, the cumulative CR8 in November 2021 was 80.7%, down 0.1pts from the previous month, down 1.7pts from the same period of last year and 1.6pts from the same period of 2019; However, in terms of the cumulative market share of SF, Yunda, Yuantong and Yunda, the cumulative Cr4 of A-share express in November 2021 was 52.0%, which was basically the same month on month, increased by 2.99pts compared with the same period in 2019, and the single volume still showed a head trend.
Revenue: SF continues to lead A-share express companies. In November 2021, SF Express’s revenue increased by + 10.95% year-on-year to RMB 16.245 billion, with a two-year compound growth of 20.52%; Yunda Express’s revenue increased by + 20.70% year-on-year to RMB 4.473 billion, with a compound growth of 10.98% in two years; Yuantong Express’s revenue increased from + 27.35% to 4.512 billion yuan year-on-year, with a compound growth of 19.00% in two years; Sto Express Co.Ltd(002468) revenue increased by + 19.88% year-on-year to RMB 2.907 billion, with a 2-year compound growth of 1.91%.
Investment: the track pattern is gradually clear and optimistic about the leading development
Policy supervision is the source driving force for the recovery of the express industry. The regulations on the promotion of the express industry of Zhejiang Province have been formally enacted at the end of September and will be implemented from March 2022. We believe that the policy tone has two directions: curbing vicious competition at low prices and protecting the rights and interests of end couriers. It is expected to form a demonstration effect in the country in the future, Drive the industry boom repair from “unit price repair” to “profit repair”. The tail enterprises with imperfect network construction, weak scale effect and poor operation and management ability will gradually strengthen the vicious circle of cost side pressure due to the inability to grab the volume at a low price, and finally clear out from the market. The high share and low-cost leaders will break through in the peer competition and the position of the industrial chain.
Express value repair is divided into three levels and two stages, which is about to enter the essential level of profit repair. For the value restoration after the vicious price war, we believe that we should distinguish three levels: 1) policy control, 2) price return, and 3) profit restoration. In the second and third quarters of this year, with the introduction of the policy, the industry price gradually returned to a benign trend. After the policy and price repair, it is about to enter the most essential level of value repair, that is, the profit repair level, and the corresponding market value performance has entered the core stage. We expect Q4 and next year’s overall profit inflection point to be upward. In 2022, the single piece profit repair superimposed scale will increase, and the leading performance will have high elasticity. It is recommended to pay attention to the certainty of value, repair the Yunda Holding Co.Ltd(002120) and Zhongtong express, the leader of single volume and profit; In terms of direct marketing, it is suggested to continue to pay attention to S.F.Holding Co.Ltd(002352) of network extension and barrier upgrading under the broad layout of traditional + emerging business formats.
Risk warning: loose policy control; Deterioration of express price war; The growth of physical online shopping fell.
