Market review last week:
Last week (March 7-march 11, 2022), the food and beverage sector (Shenwan) fell by 2.06%, the Shanghai Composite Index fell by 4.00%, the Shenzhen Component Index fell by 4.40%, and the Shanghai and Shenzhen 300 fell by 4.22%. The food and beverage sector outperformed the Shanghai Composite Index by 1.94 percentage points, ranking third in the weekly rise and fall of Shenwan's 31 primary sub industries.
Core view: the monthly data verify that the fundamentals are worry free, and the steady growth helps support the valuation
Baijiu: 1-2 monthly data show a bright overall performance, and verify the basic concern of the Baijiu industry. Maotai, Fenjiu, Jiugui Liquor Co.Ltd(000799) etc. performed well from January to February, calming the market pessimism Wuliangye Yibin Co.Ltd(000858) valuation discount is relatively obvious. Under the double improvement of reform and rating improvement, there is room for valuation repair. Sub high end Baijiu is still the fastest growth volume, and the efficiency of channel reform and landing implementation is the key factor for the short term growth of liquor companies. The performance improvement momentum of sub high-end liquor enterprises comes from the volume increase brought by their national expansion and the ton price increase brought by the upgrading of product structure. It is suggested to pay attention to the secondary high-end liquor enterprises with strong medium and long-term performance growth certainty. The increase of CPI data is still weaker than that of seasonality, reflecting the relatively weak demand side of residents. However, under the main tone of "steady growth" this year, it will continue to promote the continuous recovery of consumption, and the demand side of food and beverage may usher in improvement, which will help support the valuation. In the year of "steady growth" policy, the scale of social financing increased first, and the stock price of Baijiu industry lagged behind for 6 months. Steady growth of the capital investment in fixed assets and other fixed assets investment growth led to the Baijiu industry with a strong demand side, leading to the performance improvement of the report end; The central bank's liquidity release actions are based on the M2 structure, which will support the valuation of the Baijiu sector. MLF
Condiments: wait for inventory digestion and demand improvement. The leader is expected to reap market share after the operation stabilizes. From January to February 2022, according to Alibaba online data, seasoning sales decreased by 19% year-on-year. In addition to the impact of flow decentralization, the epidemic broke out in many places, and the demand side is still slightly weak. On the expense side, the condiment industry raised its price in the fourth quarter of 2021, and the expense rate on the statement side is expected to increase in 2022h1. In 2017, the price of condiments was raised again, and the price increase of leading enterprises was conducted smoothly. Under the strong demand, the sales volume gradually digested the inventory; After the four quarter of this round, the short-term inventory of dealers increased, leading tiktok has the experience of raising prices in 2015 and balancing high inventory, and is expected to make a smooth transition, and the dissemination of new media channels such as Chung Ju and jitter. The leader is expected to reap market share after the operation stabilizes.
Beer: without fear of cost pressure, the high-end industry contributes to the medium and long-term prosperity. There is no need to worry too much about the cost side pressure of leading enterprises. China Resources and heavy beer have locked in the price of barley in 2022 ( Tsingtao Brewery Company Limited(600600) also locked in part of the price) and made some packaging material inventory reserves, and the enterprise side is expected to raise the price at any time in 2022. At present, the marketing of beer enterprises is smooth, and the transmission of price increase is relatively smooth. In 2021, beer production increased by 5.6% year-on-year. The high-end logic of steady increase in industry volume and price has been established, and there is no fear of high inventory. The leader raised prices collectively last year, and the development trend of competition and cooperation in the industry is good. In terms of competition pattern and business format, the concentration of leaders has been continuously improved, the monthly market share data of China Resources and Carlsberg have increased slightly, Chongqing Brewery Co.Ltd(600132) pays attention to the cultivation of end consumers and is highly aggressive.
Investment advice
Plate allocation: Baijiu beer dairy products snack food condiment;
Baijiu: we should pay attention to the high potential Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Gujing Distillery Company Limited(000596) , Shede Spirits Co.Ltd(600702) and Anhui Kouzi Distillery Co.Ltd(603589) of high-end liquor enterprises Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) and sub high end wine enterprises. Beer: it is suggested to pay attention to Tsingtao Brewery Company Limited(600600) with optimized product structure and Chongqing Brewery Co.Ltd(600132) ; Dairy products: it is suggested to pay attention to Inner Mongolia Yili Industrial Group Co.Ltd(600887) , which makes concerted efforts in production capacity, channels and products.
Risk tips:
Baijiu price rise less than expected, terminal demand fell, food safety issues.
