This week we visited the Baijiu terminal stores in Hefei, Huaibei and Lu’an. We investigated the current situation of Baijiu selling in Anhui province and compared the visits with the Spring Festival.
Baijiu Market: Liquor production and marketing major province, consumption upgrade is obvious. Anhui has always been a major Baijiu producing and selling market with strong drinking atmosphere. According to our estimate, the Baijiu market in Anhui province is about 35 billion yuan. From the consumption trend, in 2021, with the per capita disposable income of Anhui province breaking through 30 thousand yuan, the third round of consumption upgrading was officially opened. The mainstream price belt of Baijiu was more than 300 yuan from 200300 yuan, and the overall price reduction situation was increasing. Under this trend, Huizhou liquor enterprises have laid out sub high-end price band products one after another, and Gujing, the leading brand in the province, and the price band of more than 500 yuan for the card space of Anhui Kouzi Distillery Co.Ltd(603589) new products, so as to realize the extension of brand potential energy. From the perspective of competition in the province, Gujing and Anhui Kouzi Distillery Co.Ltd(603589) are expected to monopolize the sub high-end price belt in the province in the future. Yingjia Dongzang has a medium and high-end price band of 100300 yuan, which realizes differentiated competition with the two leaders.
Feedback from channel research: 1) Anhui Gujing Distillery Company Limited(000596) : Gujing’s dynamic sales are in good condition during the Spring Festival this year. As of early February, the goal of Spring Festival payment collection has been basically completed, which has increased significantly year-on-year in 2021. The terminal dynamic sales are benign and the inventory pressure is small. In terms of products, products of Gu 8 and above maintained rapid growth, of which Gu 8 maintained the level of previous years, and Gu 16 and Gu 20 increased rapidly. 2) Anhui Kouzi Distillery Co.Ltd(603589) : according to the feedback of channel research, the progress of payment has been good so far, and the terminal dynamic sales are relatively strong. From the perspective of product structure, thanks to the company’s intensive cultivation of high-end product channels, the proportion of three high-end single products in the company’s revenue in 518, Anhui Kouzi Distillery Co.Ltd(603589) 10 years and Anhui Kouzi Distillery Co.Ltd(603589) 20 years has increased rapidly, driving the company’s potential to continue to grow. 3) Anhui Yingjia Distillery Co.Ltd(603198) : the sales of dealers during the Spring Festival increased significantly compared with last year. Many dealers cleared their inventory and replenished again. Among them, Dongzang series performed well, accounting for 50% of the sales in the province.
Terminal survey feedback: the overall dynamic sales is normal, and the performance of local brands is strong. Feedback from grassroots research shows that the Baijiu industry has been in the off-season, and the overall dynamic sales have declined significantly during the Spring Festival. At present, the trend of consumption upgrading in Huaibei is obvious. The mainstream liquor prices continue to upgrade. The main wedding banquet in the urban area of Anhui Province is mostly 10 years old with Baijiu, and the township has been moving from the 5 years to 6 years and the small pool. The mainstream liquor in Hefei (central Anhui) also shows a trend of transformation from ancient 8 to ancient 16. In terms of price, the terminal price of high-end wine decreased slightly, and the transaction price of GU20 decreased by 30 yuan / bottle compared with that during the Spring Festival, mainly due to the weakening of consumption scenes such as gifts and banquets. The low-end liquor price system is relatively stable, and the terminal dynamic sales are good. The delivery date of most products is after November 2021, and new products after January 2022 can also be seen.
Investment suggestion: in the short term, repeated epidemics and high costs put pressure on the dynamic sales and performance of consumer goods companies, but China is optimistic about the recovery of consumption under the expectation of stable economic growth. Baijiu liquor has a significant callback in recent years. We recommend it in advance. The core recommendations are Luzhou Laojiao Co.Ltd(000568) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Kweichow Moutai Co.Ltd(600519) and Wuliangye Yibin Co.Ltd(000858) , and maintain the recommended real estate liquor, Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Kouzi Distillery Co.Ltd(603589) and Anhui Yingjia Distillery Co.Ltd(603198) . The demand for popular products is picking up, the cost side is under pressure in stages, and we are optimistic about the elastic release of subsequent performance. Core recommendations: Qingdao Richen Food Co.Ltd(603755) , Chongqing Fuling Zhacai Group Co.Ltd(002507) , Qianhe Condiment And Food Co.Ltd(603027) , Sichuan Teway Food Group Co.Ltd(603317) , Tsingtao Brewery Company Limited(600600) , Beijing Yanjing Brewery Co.Ltd(000729) .
Risk tips: the consumption upgrading in the province is less than expected, the risk of repeated epidemic, and the error of sample selection.
