1-2 months, the growth momentum of Baijiu has not been reduced, Inner Mongolia Yili Industrial Group Co.Ltd(600887) has achieved a good start in Baijiu district.
From March 7 to March 11, the food and beverage index fell by 2.1%, ranking fourth in the primary sub industry, outperforming Shanghai and Shenzhen 300 by about 2.1pct. The other industries (0%), Baijiu (-0.6%) and pre processed food (-1.5%) in the sub sectors were relatively ahead. Disturbed by geopolitical and financial factors this week, the market fell irrationally. The food and beverage industry has shown strong resilience, mainly because some companies dominated by Kweichow Moutai Co.Ltd(600519) have released performance forecasts, with performance growth exceeding expectations, strengthening market confidence, and also reflecting the characteristics of strong performance support in the food and beverage sector. From the performance forecast, high-end Baijiu is stable overall. Wuliangye Yibin Co.Ltd(000858) expects 2021Q4 revenue and profit to grow by 11% or so. Luzhou Laojiao Co.Ltd(000568) 2021q4 revenue and profit increased by 24% and 32% respectively, both meeting the target of the year. In 2022, 1-2 months, Kweichow Moutai Co.Ltd(600519) announced that the high-end Baijiu sales were booming, with the expected growth in revenue and profit of 20%. Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , the second high-end Baijiu, expects to grow 35% and 50% in revenue and profit in 1-2 months, mainly from the improvement of the product mix. The growth rate of the epidemic is not decreasing, and the annual performance is still exceeding expectations. Jiugui Liquor Co.Ltd(000799) it is estimated that the revenue and profit from January to February will increase by 120% and 130% respectively, still maintaining the momentum of rapid growth. The external environment has limited impact on the company’s dynamic sales, and the market price is stable and good. Among Volkswagen products, Inner Mongolia Yili Industrial Group Co.Ltd(600887) expects the revenue and profit to increase by 15% and 20% respectively from January to February, making a good start Inner Mongolia Yili Industrial Group Co.Ltd(600887) tender offer for Aoyou is successful. The two sides can cooperate deeply in milk sources, channels and products, which will help the company achieve the medium-term strategic goal of No. 1 in the industry. On the whole, benefiting from the good performance forecast, the callback range of the food and beverage sector is significantly better than that of other industries. After an irrational decline in the market, we think there is no need to be pessimistic. The valuation of most enterprises has reached a reasonable range or even lower than the average level in recent three years. After this round of decline, it has a high cost performance. It is suggested to give priority to the distribution of boom and undervalued varieties.
Recommended combination: Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Foshan Haitian Flavouring And Food Company Ltd(603288) , Cabio Biotech (Wuhan) Co.Ltd(688089)
(1) Kweichow Moutai Co.Ltd(600519) forecasts 1-2 months of revenue and profit of 20% over expected growth, showing the Spring Festival high-end Baijiu sales trend, but also reflects the obvious effect of sales reform. Considering the supply of base liquor, it is expected that the planned revenue target rate will accelerate in 2022. The company has room to move calmly in terms of volume and price, and the logic of simultaneous rise of volume and price in the future is smooth. (2) Wuliangye Yibin Co.Ltd(000858) forecast 2021q4 to achieve revenue growth of 11% and net profit growth of about 11%. During the Spring Festival, the inventory of movable sales is good. After the management of the company is stable, it is expected to carry out the work of raising prices. It is estimated that the double-digit growth rate will be completed in 2022. (3) Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) it is estimated that the revenue and profit from January to February will increase by more than 35% and 50%, mainly due to the significant improvement of product structure, the growth momentum under the epidemic situation remains unchanged, and the annual performance is still possible to exceed expectations. (4) Foshan Haitian Flavouring And Food Company Ltd(603288) the price increase has a positive impact on costs and channel profits. The condiment industry is slowly repaired, and the company also shows a recovery trend. Considering the price increase, it is expected to return to the normal growth level in 2022. Proposed layout and long-term holding. (5) Cabio Biotech (Wuhan) Co.Ltd(688089) : equity incentive is implemented. After the implementation of the new national standard, the milk powder industry will start a new round of formula upgrading to accelerate the medium and high-end of the milk powder industry. The company is expected to fully benefit from the dividend of the new round of formula upgrading. At the same time, the second growth curve of SA is opened, and the cosmetics market is expected to relay.
Risk tips: economic downturn, food safety, fluctuations in raw material prices, lower than expected recovery in consumer demand, etc.
