Kweichow Moutai Co.Ltd(600519) (600519)
Event: the company issued the announcement on production and operation in 2021 on January 1, 2022. According to the preliminary accounting of the company, in 2021, the company will produce about 56500 tons of Maotai base liquor and about 28200 tons of series base liquor; It is expected to achieve a total operating revenue of about 109 billion yuan (including about 93.2 billion yuan for Maotai liquor and about 12.6 billion yuan for series liquor), an increase of about 11.2% year-on-year; The net profit attributable to the shareholders of the listed company is expected to be about 52 billion yuan, a year-on-year increase of about 11.3%.
comment:
Maotai liquor and series liquor are driven by two wheels, and the growth rate of Q4 performance of the company is improved. In 2021, the company achieved a total operating income of about 109 billion yuan and a net profit attributable to the parent company of about 52 billion yuan, with a year-on-year increase of 11.2% and 11.3% respectively. The performance achieved steady growth and met expectations. By category, the company has implemented the strategy of double wheel drive of Maotai liquor and series liquor, and the series liquor has achieved rapid growth. In 2021, the company’s Maotai liquor achieved an operating revenue of about 93.2 billion yuan, a year-on-year increase of 9.87%; The operating revenue of series liquor was about 12.6 billion yuan, a year-on-year increase of 26.11%. In a single quarter, the total operating revenue of Q4 was about 31.947 billion yuan, a year-on-year increase of 12.42%; The net profit attributable to the parent company was about 14.734 billion yuan, a year-on-year increase of 14.48%. The overall growth rate of Q4 performance of the company was faster than that of the first three quarters.
The technological transformation project promotes the increase of base liquor production capacity. It is expected that the company will enter the production capacity release period in 2022. In 2021, the company will produce about 56500 tons of Maotai base liquor, with a year-on-year increase of about 12.55%; About 28200 tons of series wine base liquor were produced, with a year-on-year increase of about 13.25%. In 2020, the company’s output of Maotai base liquor and series base liquor increased by 0.63% and decreased by 0.78% respectively year-on-year. Compared with 2020, the release process of base liquor capacity of the company in 2021 is accelerated. The accelerated release of the company’s base liquor production capacity is mainly due to the full completion and operation of the Maotai liquor technical transformation project in the 13th five year plan and the orderly promotion of a series of liquor technical transformation projects. In addition, the company’s Maotai base liquor production increased steadily from 2016 to 2018 after declining in 2015. In 2018, the company’s output of Maotai base liquor was 49700 tons. Combined with the production cycle of Maotai liquor, it is expected that the company will enter the production capacity release period in 2022.
The product structure was optimized and upgraded, and the channel reform was continuously promoted. In terms of products, on the basis of consolidating Feitian Maotai, the company continues to optimize the product structure and promote the upgrading of product structure. On December 29, Kweichow Moutai Co.Ltd(600519) released super high-end Kweichow Moutai Co.Ltd(600519) wine (treasures). After the release of the new products, the company raised the prices of the new rare Maotai liquor and the aged Kweichow Moutai Co.Ltd(600519) liquor 15 on January 1, 2022. Among them, the retail guide price of new rare Maotai liquor was raised from 4499 to 4599 yuan, and the retail guide price of aged Kweichow Moutai Co.Ltd(600519) liquor 15 was raised from 4999 to 5999 yuan. In terms of channels, since 2018, the company has carried out channel reform, vigorously developed direct sales channels, and gradually moved towards flattening. The development of direct sales channels is expected to further promote the ton price of the company’s products.
Maintain recommended ratings. It is estimated that the company’s earnings per share in 2021 / 2022 will be 42.05 yuan and 49.07 yuan respectively, and the corresponding PE valuation will be 49 times and 42 times respectively. The company’s total operating revenue exceeded 100 billion yuan for the first time in 2021. As the leader of the Baijiu industry, the strategy of Moutai and series wine is two wheel drive clear, and the expansion of direct selling channel is expected to raise the product ton price. With the release of production capacity, the company has room for further improvement in volume and price. Meanwhile, the newly appointed chairman has strong confidence in the company’s reform, the market has high expectations for the company’s reform, and the company’s performance is expected to make progress while maintaining stability. Maintain the “recommended” rating of the company.
Risk statement Product upgrading is less than expected, direct sales channel expansion is less than expected, capacity release is less than expected, food safety problems, macroeconomic impact, etc.
