\u3000\u3 China Vanke Co.Ltd(000002) 507 Chongqing Fuling Zhacai Group Co.Ltd(002507) )
The performance meets the previous forecast and maintains the “buy” rating
Chongqing Fuling Zhacai Group Co.Ltd(002507) 2021 revenue of 2.52 billion yuan, an increase of 10.8% year-on-year; The net profit attributable to the parent company was 740 million yuan, a year-on-year decrease of 4.5%, and EPS was 0.87 yuan. In 2021q4, the revenue was 560 million yuan, with a year-on-year increase of 18.7%; The net profit was 240 million yuan, a year-on-year increase of 45.7%. The performance meets the previous notice. Considering the weak consumption environment, we slightly lowered the profit forecast for 20222023. It is estimated that the profit from 20222024 will be 970 (- 0.6), 1170 (- 0.7) and 1.4 billion yuan respectively, and the EPS will be 110 (- 0.06), 1.31 (- 0.09) and 1.58 yuan respectively, with a year-on-year increase of 31%, 20% and 20%. The current share price corresponds to 27.3, 22.8 and 18.9 times of PE. Considering the price increase and cost reduction, the company has a strong certainty of improving the profit margin in 2022, and the performance release has a band market, Maintain the “buy” rating.
The increase of average price promotes the growth of revenue in 2021; Low base and channel goods preparation promote the acceleration of 2021q4 shipment
In 2021, the company’s sales volume decreased by 1.7% and revenue increased by 10.8%, which should be mainly due to price increase. Throughout the year, the revenue of the main category mustard increased by 12.73%, of which the sales volume decreased by 1% and the price increased by 13.9%; Turnip revenue decreased by 30.8%, of which the sales volume decreased by 36% and the price increased by 8.2%. In terms of subregions, East China, South China, Northeast China, central China and other places maintained a growth rate of more than 10%, contributing to the main increment. The growth rate of southwest and northwest regions is weak. In 2021q4, the revenue increased by 18.7% and increased significantly month on month, which should be related to the active preparation of goods through the price increase channel in November. In 2022, the company will focus on category breakthrough and channel breakthrough, and achieve the revenue growth target of 15% in the whole year.
2021q4 net profit increased by 45.7%, mainly due to the decline of sales expense rate
The gross profit margin of 2021q4 was 36.1%, a year-on-year decrease of 23.6pct. On the one hand, the high price of green vegetables in the current year was used, on the other hand, the company adjusted the accounting policy to transfer the freight to cost settlement. The sales expense ratio decreased by 25.9pct year-on-year. In addition to the adjustment of subjects, the reason is that the market expense has converged after the demand in the fourth quarter has increased. Taken together, the gross sales difference increased by 2.3pct year-on-year, still making a positive contribution to profits. In 2021, the sales expenses increased by 29.7% year-on-year, mainly increasing the investment in brand publicity. Among them, the advertising of ladder media and China Central Television accounted for about 55% of the brand publicity expenses, accounting for a relatively high proportion. It is expected that the expenses may converge significantly in 2022.
The focus of 2022 is profit release
In 2022, the company has a high probability of increasing its profit margin. The main sources are as follows: first, the effect of price increase at the end of the year should appear throughout 2022; Second, the purchase price of qingcaitou, the main raw material, was basically determined, and the cost decreased significantly year-on-year; Third, considering that the annual cost rate may shrink accordingly after the reduction of ladder media advertising.
Risk tips: macroeconomic fluctuation risk, market expansion and competition risk, raw material price fluctuation risk, etc
