\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 315 Shanghai Jahwa United Co.Ltd(600315) )
Main points:
Events
The company disclosed the annual report of 2021 and realized a revenue of 7.65 billion yuan (+ 8.7%); The net profit attributable to the parent company was 650 million yuan (+ 50.9%); The net profit deducted from non parent company was 680 million yuan (+ 70.8%), and the basic earnings per share was 0.97 yuan / share.
Focus on skin care products, head brand performance is bright
The company adheres to the “123” business policy and focuses on skin care products at the brand end. In 2021, the company’s skin care business achieved a revenue of 2.7 billion yuan, a year-on-year increase of 22.2%. The company focuses on explosive products, streamlines SKUs, and concentrates resources to build head brands. Through precise marketing such as content marketing and IP cross-border cooperation, the products reach more young consumers, deepen the brand image and enhance the brand stickiness. The repurchase rate of baicaoji tmall flagship store and department store increased from 33.7% in 2020 to 41.6% in 2021, and the repurchase rate of Yuze tmall flagship store increased from 36.4% in 2020 to 42.6%. From the perspective of single products, all the single products of baicaoji brand-new Taiji Jiyuan series entered the brand head sales SKU, and became the top five explosive products of brand e-commerce sales during the double 11; Yu Ze new blue cabin essence listing GMV exceeded 10 million yuan in the first week.
Online multi platform operation and offline embrace new retail
Carry out fine operation online and promote multi platform layout. RMB 3.21 billion was realized in 2021, with a year-on-year increase of 7.9%. A total of 82 stores were operated, more than double the 36 stores in 2020. Among them, tmall platform has further enriched the live broadcast matrix by strengthening the layout of store self broadcasting, and maintained steady growth as a whole; After optimization and adjustment, JD platform business began to achieve rapid growth and turn around losses; Pinduoduo platform was among the first batch to be shortlisted in the “supernova plan”, interested in e-commerce platform innovation and exploring new ways of playing in people and goods yard, and the business showed rapid growth. In addition, Jiahua live broadcast center went online to help the company’s self broadcast business through nearly 18000 hours of live broadcast. Offline revenue in 2021 was 4.43 billion yuan, an increase of 9.3% year-on-year. Continue to promote the transformation of new retail offline. In 2021, the growth of new retail exceeded 100%, accounting for more than 10% of China’s offline channels.
Increase the proportion of high gross profit business and promote the improvement of the company’s profitability
The gross profit margin of the company in 2021 was 58.7%. Due to the adjustment of accounting policies, after retroactive adjustment of the data in the same period of last year, it increased by 2.8pct year-on-year. In 2021, the annual net interest rate was 8.49%, up 2.4pct, and the profit was greatly improved. This is mainly because the proportion of skin care business with higher gross profit margin increased from 31.4% in 2020 to 35.3%, an increase of 4pct. On the cost side, brand marketing and R & D investment continued to grow. In 2021, the company’s sales expense was 2.95 billion yuan (+ 11.7%), and the management expense was 790 million yuan (+ 9.8%); The R & D cost is 160 million yuan (+ 13.1%).
Investment advice
The company’s brand building is changing from “multi brand” to “excellent brand”. Through “survival of the fittest”, the company tilts resources to products with large single products and popular characteristics, so as to achieve a win-win effect of natural drainage and performance growth. Make concerted efforts online and offline to promote the transformation of new retail, create private traffic and enhance customer stickiness. We expect that the company’s EPS from 2022 to 2024 will be 1.2, 1.4 and 1.7 yuan / share respectively, corresponding to 30, 25 and 21 times of the current share price PE respectively. Maintain the “buy” rating.
Risk tips
The promotion of new products is less than expected; The progress of online channel expansion is less than expected; Industry competition intensifies; Repeated outbreaks, etc.
