\u3000\u3 Shengda Resources Co.Ltd(000603) 187 Qingdao Hiron Commercial Cold Chain Co.Ltd(603187) )
Event: Qingdao Hiron Commercial Cold Chain Co.Ltd(603187) released the operating data from January to February 2022. From January to February in 2022, the company realized a revenue of 500 million yuan, yoy + 45%; Achieved performance of 45 million yuan, yoy + 17%. The company's revenue performance exceeded expectations. We continue to be optimistic about the progress made by the company in expanding new customers. It is expected that the company will continue to increase its market share in the future.
Rapid growth of revenue: from January to February, Hairong's revenue achieved 40% + growth. According to our analysis, this is mainly due to the company's expansion of new high-quality customers and the increase of its share in existing customers. It also reflects that the company's products and services are better than its competitors. We expect that this year, Hairong has a solid position in the freezer industry, and the business of refrigerators, supermarkets and smart sales cabinets is expected to maintain rapid growth.
Affected by costs and accrued expenses, the performance growth is slower than revenue: the performance growth of Hairong from January to February is slower than revenue. According to our analysis, the main reasons are: 1) the rise of raw material prices. 2) It is estimated that the accrued equity incentive expenses from January to February 2022 will be about 13 ~ 14 million yuan, accounting for about 30% of the current performance. We believe that the company's customer structure is constantly optimized and its profitability is expected to recover in the future.
Fulfilling the Growth Logic of Hairong: in the field of commercial freezers, Hairong has obvious advantages: 1) in terms of management, Hairong has a more perfect incentive system, and the core management team and key technical personnel are stable. 2) The company has the advantages of customization, intelligence and scale. 3) In terms of customer resources, Hairong's downstream customers are leading enterprises in the food and beverage industry. These leading companies have strict screening standards for suppliers. After Hairong breaks through these large customers, orders will increase in large quantities and customer stickiness will be relatively high. Hairong's customer reputation accumulated over the years will also help the company develop new customers. Taking the refrigerated cabinet that Hairong has focused on in recent years as an example, the compound growth rate of revenue from 2015 to 2020 was 32%.
Investment suggestion: we believe that the market underestimates the space of the commercial refrigeration display cabinet industry and the competitive barriers of high-end customers, and has insufficient expectations for the growth potential and performance elasticity of the company. The specialization advantage of Hairong is evolving into scale advantage, and the growth logic will be realized gradually. We expect EPS to be 0.88/1.48 yuan from 2021 to 2022, with a six-month target price of 37.00 yuan, corresponding to 25 times PE in 2022, maintaining the investment rating of buy-a.
Risk tip: due to the uncertainty of overseas epidemic, the price of raw materials has risen sharply, and the expansion of customers is less than expected
