Baijiu, instant noodles and liquor, a new wave of price rises came to the market. The brewing giant Xiangpiaopiao Food Co.Ltd(603711) , the new tea drink searched the "net red" tea face, the baked food "boss" Ligao Foods Co.Ltd(300973) , the instant noodles giant Japanese food and so on, and the products involved in brewing milk tea, new tea drinks, baked food, instant noodles and other fields.
Among the various tucking noises that followed, many make complaints about the reasons for the price increase: Why are all these companies in such a rush to raise prices? Aren't you afraid that consumers won't buy after the price rise?
another wave of intensive price increases by companies
within two days, another wave of companies announced price increases.
On January 5, the A-share listed company Xiangpiaopiao Food Co.Ltd(603711) announced that it would adjust the price of the company's solid brewing milk tea (including classic series and good material series), with the price increase range of main products ranging from 2% to 8%, and the new price will be implemented according to the price adjustment notice of each product from February 1.
Before that, the company was well known in China by virtue of the advertisement of "annual sales volume can circle the Earth twice", which can be called the "King" of brewing milk tea industry. However, at present, due to the impact of various new tea drinks on the milk tea market, the company's share price has fallen from the high of 37.85 yuan / share in 2019 to about 17 yuan / share, basically "halving" .
Coincidentally, shortly after the king of brewing milk tea announced the price increase, the tea Yan Yuese of the new tea next door also announced the price increase soon. In January 5th, tea yam Yue announced its brand WeChat official account. Since January 7, 2022, most of the tea products have risen 1 to 2 yuan.
Tea Yan Yuese also stressed that it has been more than five years since the last overall price adjustment. The price maintenance in these five years is not only because of feelings, but also because of the spontaneous support of customers brought by brand dividends, which saves a lot of marketing costs; Second, relying on the procurement bonus brought by the expansion of scale, the material cost is reduced.
Similarly, there are GEM listed companies Ligao Foods Co.Ltd(300973) whose main business involves frozen baked goods and baked food raw materials. When the company was listed in April 2021, it was once regarded as "the first share of baked food" . Although most people do not know much about it, looking at the enterprises and products with which it cooperates can well illustrate its influence.
For example, "wanghong" sweet potato and Swiss Roll, which were popular in Sam and HEMA before, are from Ligao Foods Co.Ltd(300973) . In addition, wife cake, egg tart skin, doughnuts and mousse cake are also the company's main products. In addition to Carrefour and Yonghui Superstores Co.Ltd(601933) , customers include chain bakeries such as happy pastry, Haolilai and bread Xinyu, as well as Haidilao, haokelai Hilton huanpeng Hotel and other chain restaurants are common customers of the company.
However, on January 5, Ligao Foods Co.Ltd(300973) announced that it would adjust the ex factory prices of some main frozen baked foods and baked raw materials by 3% - 8%. The adjusted prices will be implemented according to the price adjustment notice of each product from January 4, 2022.
In addition, the manufacturer Riqing food , "the first share of cream" Shanghai Hi-Road Food Technology Co.Ltd(300915) , "the first share of condensed milk" Panda Dairy Corporation(300898) also successively issued relevant announcements on product price increase recently.
Various news of price increases broke out one after another, and netizens were also in hot debate. Some people wondered if Xiangpiaopiao Food Co.Ltd(603711) would "circle the earth a few times less" after the price increase; Some people lamented that Ligao Foods Co.Ltd(300973) was originally a "hidden boss", and the online red products usually bought were sent by freezing; Some people are relatively relaxed, saying that the prices of tea are "very expensive" and they don't plan to buy it again after they didn't join the fun before; Some people worry that if the prices of brands rise one after another, will they "can't afford anything"
reason for price increase: life is hard
it is worth noting that in the relevant announcements, several companies that have recently raised prices have mentioned the problems of "rising raw material prices" and "rising costs".
For example, Xiangpiaopiao Food Co.Ltd(603711) said in the announcement that the main reasons for the price increase are the continuous rise in the costs of raw materials, labor, transportation and energy, so as to better provide high-quality products and services to dealers and consumers and promote the sustainable development of the market and Industry.
On the issue of rising costs, Xiangpiaopiao Food Co.Ltd(603711) once pointed out the risk in the 2021 semi annual report that the main raw materials for brewing milk tea include skimmed milk powder and vegetable fat powder, sugar, tea powder, red beans, coconut, etc., and the packaging materials mainly include milk tea cup, cup cover, straw, packaging box, gift box, etc., which account for a large proportion of the production cost.
The company said that although the leading market share in the industry and the company's centralized procurement mode can ensure the company's bargaining power in the procurement link, if the supply and demand of main raw materials change greatly or the price fluctuates abnormally recently, it will have a certain impact on the company's operation. Therefore, the company has the risk of price fluctuation of main raw materials.
The tea Yan Yuese that also released the price rise notice, although it is not a listed company that has not disclosed specific data, from some recent news, the current situation is not good.
It is reported that in 2021, chayan Yuese experienced three centralized temporary store closures: one was the local Chinese New Year at the beginning of the year, the second was the recurrence of the epidemic at the end of July, and one was the centralized closure of about 15% of stores in November... Then the founder LV Liangdao exposed the data of "loss of 20 million yuan per month".
In addition, the company recently fell into the problem of "wage dispute", which attracted much attention from the outside world because it was revealed that the employee "worked 11 hours a day, and the monthly salary was less than 3000 yuan" (details: the first brother of wanghong milk tea was scolded for hot search, and the founder apologized) . Even after the price increase of tea Yan Yuese was announced, many netizens questioned in the comments: "has the employee's salary also increased?"
On the other hand, Ligao Foods Co.Ltd(300973) is also trapped by the rising cost of raw materials. In its announcement, it said that the price increase was based on the continuous rise in the costs of main raw materials, packaging materials, auxiliary materials and energy, as well as the cost increase brought by the company's optimization and upgrading of products. At the same time, the price increase was also to better provide consumers with high-quality products and services and promote the sustainable development of the market.
The company's 2021 semi annual report pointed out that Ligao Foods Co.Ltd(300973) is a production-oriented enterprise, and the direct material cost accounts for a relatively high proportion. The main raw materials are bulk Shenzhen Agricultural Products Group Co.Ltd(000061) raw materials such as oil, sugar and flour. Its price fluctuation will affect the gross profit margin and operating profit of the company's products, and even have a great impact on the company's future performance. Specifically, in the first half of 2021, the company's gross profit margin in the bakery industry was 35.88%, a decrease of 0.98% compared with the same period last year, and the company's gross profit margin in other industries was 35.88%, a decrease of 0.98% compared with the same period last year.
what is the impact of price increase?
So, what impact will these companies bring when they successively announce product price increases?
Zhu danpeng, a consumer goods industry analyst, said that the Xiangpiaopiao Food Co.Ltd(603711) price increase was due to rising costs. First, because Xiangpiaopiao Food Co.Ltd(603711) has a certain voice in the brewing milk tea market , its ready to drink milk tea develops slowly and has no confidence to raise the price; second, the price of Xiangpiaopiao Food Co.Ltd(603711) ready to drink milk tea itself is high , so there is no need to digest the rise of costs through price increase.
Ping An Securities pointed out that enterprises with strong voice and strong brand power usually raise prices directly, while weaker enterprises raise prices indirectly by pushing new products or changing packaging. different companies raise prices in different ways. Among them, companies with strong brand tend to raise prices directly due to high consumer recognition. For companies with weak brand power or in the downward cycle of the industry, they will launch new products with higher unit price by changing packaging and specifications to gradually replace the old products, so as to realize price increase in disguised form.
nevertheless, it seems that most of the companies that announced the price increase still lack "confidence" in the impact of the price adjustment.
For example, Xiangpiaopiao Food Co.Ltd(603711) who "has certain bargaining power" said in the announcement that the price adjustment of some products may have a certain impact on the market share of the company's products. Coupled with the rising cost factors, the price adjustment of does not necessarily increase the company's profits , and the impact of the price adjustment on the company's future performance is uncertain.
Ligao Foods Co.Ltd(300973) , Shanghai Hi-Road Food Technology Co.Ltd(300915) , Panda Dairy Corporation(300898) etc. all said in the announcement that "it may have a certain impact on market sales and uncertainty on the future performance of the company, please pay attention to the investment risk ."
so what is the real "confident" price increase? The difference can be clearly seen by comparing some listed companies upstream of the industrial chain in the A-share market.
Last month, the listed company Cnnc Hua Yuan Titanium Dioxide Co.Ltd(002145) in the titanium dioxide industry announced that it would raise the price from January 1 this year. At the same time, the company said that the overall increase in the sales price of its main products will help further improve the company's sustainable profitability and improve the company's market position and influence, is expected to have a positive impact on the company's operating results. reflected in the stock price, the price of Cnnc Hua Yuan Titanium Dioxide Co.Ltd(002145) titanium dioxide was raised eight times last year, and the stock price also rose 126% in one year.
Some analysts pointed out that, combined with listed companies, the current price increase is a typical profit transition from upstream raw materials to midstream and downstream manufacturing and consumption. The upstream sector with better growth this year mainly benefited from the price rise of raw materials, and the price rise profits basically remained in the upstream. the cost of price increase is basically borne by midstream manufacturing and downstream consumer enterprises, so the share price of upstream enterprises soared, the income of midstream and downstream enterprises did not increase profits, and the share price continued to be under pressure.
However, for specific companies in specific industries, the final impact may be different.
Zheshang Securities Co.Ltd(601878) believes that the rising price of raw materials in baking business brings greater pressure on the cost side; Power rationing and some target capacity constraints affect the performance level. After the epidemic, the demand of the baking industry recovered rapidly, and benefited from the emergence of new channels such as tea and catering, and the scale of the industry increased rapidly; At the same time, benefiting from the rapid development of food industrialization and the rapid development of new tracks such as freezing and baking, downstream brands pay more and more attention to suppliers who can provide stable "quantity" and excellent "quality", and high-quality enterprises are expected to continuously improve their market share.
Orient Securities Company Limited(600958) pointed out that in terms of baking and tea raw materials, the prices of oil and other raw materials are still at a high level, but the strong demand in the downstream of determines that expanding production capacity and seizing market share is the main line of the industry . We still need to be careful that the sharp rise in the price of raw materials squeezes the gross profit, and the intensification of industrial competition leads to the loss of leading share or the reduction of cost investment efficiency, Sudden food safety incidents lead to risks such as damage to the company's operation and brand.
(Financial Investment Report)
