\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 809 Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) )
Events
According to the company’s announcement, in 2022, the company arranged the peak season of the Spring Festival ahead of schedule, with good dynamic sales in the overall market. Medium and high-end products such as Qinghua Fenjiu series achieved substantial growth, and the operating revenue and net profit achieved the best level in history. According to the preliminary accounting of the company, from January to February 2022, the company is expected to achieve a total operating revenue of more than 7.4 billion yuan, with a year-on-year increase of more than 35%; The net profit attributable to the parent company is expected to be more than 2.7 billion yuan, with a year-on-year growth rate of more than 50%.
Key investment points
Excellent performance in the peak season of Spring Festival, and it is expected that the performance of 22q1 will achieve high growth
From January to February 2022, the company’s high performance was mainly due to structural upgrading and strong development outside the province. Considering that the payment time of Fenjiu in the Spring Festival this year is slightly later and there are no high requirements for the payment progress, we expect that the early high growth trend will continue in March 22. Specifically:
1) during the Spring Festival, the dynamic sales are booming, and the high growth of Qinghua leads the improvement of product structure: during the Spring Festival, the dynamic sales of Qinghua series are booming. It is expected that the growth rate of Q1 qinghuafen will exceed 60%, and that of laobaifen will exceed 50%. Under the volume control measures of Bofen, it is similar to that of the same period last year. Among them, the growth rate of blue and white 30 revival edition leads the whole series of products. Under the background of large-scale Spring Festival, the price sector of blue and white series is strong and the inventory is benign, and the rated price of blue and white 20 and 30 revival edition is still maintained at about 380 / 860 yuan. 2021 is the year of brand development. The company adheres to the strategy of controlling the low end, holding high the blue and white, and strengthening the waist. In 2022, the company will continue to adhere to the product strategy of taking the blue and white series as the development focus, nationalizing Panama and fen25 waist products, and controlling the quantity and increasing the price of Bofen. It is expected that the blue and white series products will reach 40-45%, and the profitability will be steadily improved.
2) rapid development outside the province and steady improvement of controllable terminals: in 2021, the Fen Liquor Market with 100 million yuan increased to 22, and the sales of Zhuyeqing liquor in the southern core market increased by more than 120% year-on-year; The number of dealers outside the province increased by 30.5% year-on-year, and the number of controllable terminals increased to 1.05 million. In 2022, the company will continue to refine and deeply cultivate the sector around Shanxi, and continue to focus on developing the market south of the Yangtze River.
Development direction: take the promotion of brand power as the first, and anchor the goal of “one third of the world”
Primary objective: brand promotion; Overall marketing plan: 133238. The company will achieve the primary goal of brand improvement through four “focus” + four “persistence”: 1) focus on market structure optimization, product structure optimization, quality optimization and management improvement; We will strengthen strategic focus, deepen the reform of state-owned enterprises and persist in strengthening risk management. In the next step, Fenjiu marketing will focus on the overall reform strategy of “133238” Fenjiu marketing, that is, anchoring one goal (“one in three places”), fighting three battles (key battle of marketing systematization construction; key battle of product structure adjustment; key battle of brand value promotion), building three markets (focusing on large base market, East China market and South China market) Promote two major projects (“1s + 3M + 6p” international marketing system, Xinghua village brand / personalized brand strategy building project), closely follow three indicators (Qinghua Fen Liquor sales index, Qinghua 20 terminal index, Qinghua Fen Liquor opinion leader group index) Achieve the eight insistences (including adhering to Party building leading marketing, cultivating executive combat team, information construction, dealer structure optimization, etc.), and jointly write a new chapter of manufacturer cooperation, enterprise development and brand rise.
Beyond expectation logic: the revival version leads the high-end, and the nationalization process is accelerated or beyond expectation
The revival version leads the high-end, the layout of blue and white liquor is super high-end, and the income of blue and white liquor may account for 40% – 50% of Fen Liquor series. Blue and white series has made brilliant achievements by virtue of “the cultivation of aroma type in Bofen + excellent product quality + the mainstream consumer price band in the card position + about 10% – 15% high channel profit” – blue and white series has maintained a high-speed growth of 40% – 60% in 17-19 years, achieved a growth of more than 30% in 20 years (revenue accounts for about 25% – 30%), and the revenue of 21h1 has reached 40%, Considering that the company’s current product strategy is to “pull out the middle and control the bottom”, the ultra-high-end layout of blue and white 40 China dragon, and the launch of blue and white 30 · revival version will further improve the brand image and open the volume and price space of blue and white 20, we expect that the compound growth rate of sales revenue of blue and white series will be higher than that of secondary high-end liquor in the next 14th Five Year Plan period, During the 14th Five Year Plan period, the proportion of Qinghua’s income in Fenjiu series may reach 40% – 50%.
To the south of the Yangtze River, the expansion speed outside the province may exceed expectations. From 2016 to 2020, the CAGR of the company’s sales revenue outside the province was 42.45%, far exceeding the expansion speed in the province, and the nationalization strategy has achieved initial results. We believe that there are two highlights in the development outside the province in the future: 1) the market around Shanxi: the overall market space of the sector around Shanxi is about 180 billion yuan, and the market share of Fenjiu is less than 3%. With the upgrading of product structure dominated by qinghuafen and the further sinking of channels, The upgrading of product structure promotes the release of performance, and the central Shanxi sector still has great development potential. 2) Southern market: the market space in the south of the Yangtze River is large and the consumption price is high. Previously, the foundation of Fenjiu was relatively weak. With the southern market becoming the company’s next key market and putting forward the goal of an average growth rate of more than 50% in three years, the market performance outside the province may exceed expectations in the future.
Profit forecast and valuation
We believe that Fenjiu will benefit from the strong performance of Qinghua and the accelerated expansion outside the province. At the same time, considering the low performance base of the company affected by the epidemic in 2020 and the company’s revenue target of 30% + in 2021, the revenue growth rate from 2021 to 2023 is expected to be 47.2%, 35.6% and 31.6% respectively; The growth rate of net profit attributable to the parent company was 75.2%, 43.9% and 39.5% respectively; EPS is 4.4, 6.4 and 8.9 yuan / share respectively; PE was 62, 43 and 31 times respectively. In the long run, the performance has strong growth, the current valuation is cost-effective, and the buy rating is maintained.
Catalyst: continuous consumption upgrading and smooth introduction of high priced products;
Risk warning: the two outbreak of China’s epidemic situation affects the whole Baijiu sale of liquor. The sales of high-end liquor was less than expected; Management change wind
