Shede Spirits Co.Ltd(600702) (600702)
event
Recently, the new product "Vientiane new in the year of the tiger" was officially announced on the market. At the same time, the original core product taste and wisdom were willing. Under the background of controlling the goods, the price was stable, the inventory was at a low level in the past three years, and the business development trend was good.
Key investment points
Product: the dual brand strategy has achieved initial results, and the Tuopai structure is expected to be optimized
According to the product structure, the current revenue share of shede / Tuopai is 80% / 20%: 1) among shede brands, the revenue share of other high-end shede products such as taste shede / wisdom shede / way of shede / collection shede is about 60% / 20% / 20% / 10% respectively. Under the background of early suspension, the current rating of taste willing and wisdom willing is about 365 / 455 yuan, showing a steady upward development trend, and the inventory is at a low level in recent three years. In terms of future price system objectives, the company will strive to create a complete product series of super high-end products with 400-600 yuan of taste, 600-800 yuan of wisdom, 800-1000 yuan of collection and more than 1000 yuan; 2) From the perspective of Tuopai, the purpose of adding Tuopai customized products in 21h1 is to restore Tuopai. 21h2 will tighten Tuopai series products. The focus of investment attraction in the coming year will still be Tuopai, and will take the route of big business and excellent business; 3) Reluctant to part with new products: it is not yet on the market, but it is a potential product of the company, which will be launched through ring camp marketing, group purchase, etc; 4) High speed bottle wine: one of the main varieties in the future. In addition, according to the rhythm of payment, the company's payment collection is expected to double before the Spring Festival, and the company may have a good start.
Channel market: the performance growth mainly comes from the main sales market and old dealers, with the increase of channel volume and quality
The growth of the company this year mainly comes from old merchants / big merchants and base markets. In terms of dealers, this year, the number of large merchants with a level of more than 5 million accounts for about 20% and the revenue accounts for about two-thirds. Next year, the company will continue to carry out excellent business at the same time of expanding business through brand promotion, setting up eight front warehouses to improve response speed, high channel profits and innovative Internet marketing, so as to realize the double increase of channel volume and quality; 2) In terms of channels, the company adjusted its marketing system this year and established five business divisions (shede, Tuopai, Internet, old wine and VIP business divisions); 3) in terms of market, the company's growth rate in markets such as Hebei, Shandong and Henan may exceed 100% this year, while maintaining a high growth rate in the original core market.
Exceeding expectations: the expansion of the main market ensures sustainability, and the contribution of new products may exceed expectations
Market expectation: ① willing growth mainly comes from national investment promotion. The quality level of dealers is uneven, so the growth is unsustainable. ② Although many new products have been added this year, it will disrupt the price and the growth of main products. We believe that: ① the growth of shede mainly comes from the expansion of the main sales market, rather than the distribution of national investment. Main marketing market (old dealers + new dealers) contributed 80% of the sales growth and 15% of the new investment promotion in the new area. The annual performance may exceed expectations, while ensuring the sustainability of the growth. ② willing to contribute to the performance of new products or exceed expectations. Since Fosun took over, although the company has multiple product lines, the positioning and layout of product lines are reasonable. In terms of products, it has adopted a new strategy - Double brand war Strategy, old wine strategy, high-end strategy, etc. among them, the taste and wisdom of the original main single products are willing to continue their excellent performance, while the current price of new products is stable and the development exceeds expectations. For example, the sales scale of high-speed light bottle wine T68 is more than 100 million, contributing higher profits.
Profit forecast and valuation
The equity incentive system launched at the beginning of the 19th century helps to stimulate the enthusiasm of employees. At the same time, recently, Fosun Group executives have joined the board of directors, which is expected to help Fosun Group to embark on the performance improvement channel. With the gradual implementation of the four strategies and the steady expansion of dealers, the company is expected to accelerate the performance. We predict that the revenue growth of the company from 2021 to 2023 will be 77.5%, 50.4% and 32.1% respectively; The growth rate of net profit attributable to the parent company was 111.6%, 56.7% and 36.1% respectively, and EPS was 3.7, 5.7 and 7.8 yuan respectively; PE was 61, 39 and 29 times respectively. Considering the accelerated release of the company's reform dividend, the current valuation is cost-effective and maintains the buy rating.
Catalyst: Baijiu demand is expected to exceed expectations, and prices continue to go up.
Risk warning: 1. Epidemic situation has repeatedly affected Baijiu selling. 2. The landing effect of old wine strategy was less than expected.
