\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 702 Shede Spirits Co.Ltd(600702) )
Events
On the evening of March 17, 2022, the company released its annual report for 2021: the revenue in 2021 was 4.969 billion yuan, an increase of 83.80% at the same time; The net profit attributable to the parent company was 1.246 billion yuan, an increase of 114.35% at the same time; Deduction of non RMB 1.211 billion, an increase of 120.89% at the same time.
The performance is basically consistent with the express, and the overall trend is good
The company’s revenue in 2021 was 4.969 billion yuan, an increase of 83.80% at the same time; The net profit attributable to the parent company was 1.246 billion yuan, an increase of 114.35% at the same time; Deduct non RMB 1.211 billion, an increase of 120.89%, which is basically consistent with the company’s performance express in 2021. Among them, the revenue of 2021q4 was 1.362 billion yuan, an increase of 45% at the same time; The net profit attributable to the parent company was 276 million yuan, an increase of 2% at the same time; Deduct non RMB 251 million, with a decrease of 3% at the same time. The gross profit margin of the company was 77.81% (+ 1.94pct) in 2021, of which 77.06% (+ 2.44pct) in 2021q4. Tuopai ushered in restorative growth and high growth of customized development business, which significantly drove the overall gross profit margin upward; The net interest rate in 2021 was 25.57% (+ 3.11pct), of which 2021q4 was 20.58% (- 9.22pct), which was caused by the increase of employee compensation, marketing promotion and depreciation and amortization expenses. In 2021, the net cash flow from operating activities was 2.229 billion yuan, an increase of 124% at the same time, which was due to the same increase of 89% in cash received by the company from selling goods and providing services. The advance collection at the end of 2021 was 763 million yuan, and the dealers continued to maintain their enthusiasm for payment.
The annual volume contribution is greater than the price, and the path of nationalization is clear
On the brand side, the company operates with dual brands, focusing on creating strategic products such as taste and wisdom; Comprehensively strengthen the operation of Tuopai Qujiu, Tuopai super grade T68 and Tuopai six grain; It has been more than 2 years since the old wine strategy was put forward. The old wine strategy continues to cultivate consumer groups. It is expected to usher in high growth in the next 3-5 years, and the annual sales of the old wine division is expected to exceed 2 billion yuan in the future. On the product side, in 2021, the revenue of liquor was 4.577 billion yuan, an increase of 95%, of which the revenue of high-end liquor was 3.874 billion yuan, an increase of 82%; The revenue of low-grade liquor was 703 million yuan, an increase of 219% at the same time; The revenue of glass bottles was 356 million yuan, an increase of 7% at the same time. Split the volume and price. In 2021, the total sales volume is 39100 tons (with an increase of 150%), and the corresponding ton price is 117100 yuan / ton (with a decrease of 22%); Among them, the sales volume of shede series was 8100 tons (with an increase of 60%), and that of Tuopai series was 31100 tons (with an increase of 192%). The sales volume of medium-sized liquor is 11600 tons (with an increase of 65%), and the corresponding ton price is 334000 yuan / ton (with an increase of 10%); The sales volume of low-grade liquor was 27600 tons (with an increase of 218%), and the corresponding ton price was 25500 yuan / ton (with an increase of 0.4%). In terms of regional expansion, in 2021, the revenue within the province was 1.179 billion yuan (with an increase of 128%), the revenue outside the province was 2.995 billion yuan (with an increase of 81%), and the e-commerce was 400 million yuan (with an increase of 129%). Organizational structure, establish “production research + operation” dual headquarters, strengthen the operation and management mode of the business division of “shede, Tuopai, old wine, VIP, Internet and international business”, and improve the management efficiency.
At present, according to the strategy of “focusing on Sichuan, Hebei, Shandong and Henan, improving northeast and northwest, and breaking through East and South China”, the company has accelerated the national layout of the brand. According to the principles of brand focus, market focus and channel focus, the national market is divided into “key market, development market and potential market”, focusing on resources to create a number of key markets. The company implemented the “3 + 6 + 4” marketing strategy of old wine, actively changed its marketing thinking, and reduced the occupation of dealers’ funds by establishing eight shared warehouses and reducing the requirements of dealers for single payment. The company has established a distribution system dominated by Prefecture, county and sub brand agents. By the end of 2021, there were 2252 dealers, with a net increase of 491. It is expected that the company will further promote investment and optimize the quality of investment promotion.
Prove yourself in 2021 and make great strides in 2022
In 2021, the company has proved that two problems criticized by the market in the past have been solved: first, the goal is too high and there is pressure to complete. The revenue growth rate of 83% in 2021 proves this and is ready to make a good start in 2022; Second, the channel fees cannot be fully realized, and the problem will be properly solved in 2021.
We look at the company from three dimensions: short, medium and long term:
In the short term, the company has been on the right track, and the management and dealers are full of confidence; In the off-season of March, we believe that some dealers still pay;
In the medium term, the company has proved that it has the ability to achieve the set goals. In 2022, the company will continue to strengthen brand publicity, hold high and fight high, strengthen regional expansion, sink advantageous regional channels, and the quality of investment attraction is expected to be optimized;
In the long run, the differentiated competition brought by the company’s old wine strategy has attracted great attention from the market, the cultivation of channel consumers has been carried out, and it will take time to form a deep understanding; In addition, after Fosun takes over, it will basically solve the problems left over by Shede Spirits Co.Ltd(600702) history, and promote the company to establish an incentive mechanism. With “1 Tour” (integrating into Fosun tour) + “1 Platform” (docking platform between shede dealers and Fosun system) + “n product” (exclusive version of Fosun ecological characteristic products, services and rights and interests) as the core system, it will build a deeply empowered ecosystem for dealers; Finally, Fosun will develop and land Fosun system to jointly create products and broaden the sales channels of ecological BD.
The company as a whole has made steady progress in accordance with the established rhythm. We reiterate that we are optimistic about the company’s logic:
1) on the product side, the company focuses on the old wine strategy, adheres to the dual brand strategy of shede and Tuopai, and focuses on building strategic single products such as taste shede and wisdom shede. 2) Build new and old customers, focus on new markets, and focus on new and old customers. 3) In terms of circle marketing, the company focuses on famous wine, enters famous enterprises and smart clubs, accurately targets the circle, penetrates the head + waist + legs, and focuses on the core target customers. 4) Fosun has been in charge of the company for nearly a year. It is expected to accelerate the subsequent empowerment and promote the company to enter a new stage.
Profit forecast
Under the expansion of secondary high-end capacity, the company enjoys dividends. We are optimistic about the differentiated competitive advantage brought by the company’s old wine strategy and the acceleration of energy after Fosun takes over. We expect EPS to be 5.74/7.60/9.71 yuan from 2022 to 2024, and the current share price corresponding to PE is 31 / 24 / 19 times respectively, maintaining the “recommended” investment rating.
Risk tips
Macroeconomic downside risks, the epidemic dragged down consumption, the growth rate was less than expected, the promotion of old wine strategy was blocked, the expansion outside the province was less than expected, and the synergy between Fosun and the company was less than expected.
