Market performance
Last week, the food and beverage sector index fell by 3.63% as a whole, ranking 25th in the Shenwan sub industry, 2.68% behind the Shanghai and Shenzhen 300 index and 1.85% behind the Shanghai Composite Index. In the sub sectors, health products (3.75%) showed a rising trend. Meat products (-6.30%), soft drinks (-5.20%), beer (-5.01%), other alcoholic beverages (-4.61%), Baijiu (-4.02%), snacks (-3.77%), baked food (-2.95%), flavouring fermentation products (-2.75%), dairy products (-1.54%) all showed a downward trend.
Investment recommendation
Popular products: the transmission of price increase of popular products is basically completed, but the epidemic disturbance and rising costs, and the off-season of terminal feedback in March is lighter. We judge that the performance of the first quarter will continue to be under pressure. We prefer dairy products with relatively stable demand and room for improvement in raw milk cost, and continue to recommend Inner Mongolia Yili Industrial Group Co.Ltd(600887) . After the tender offer of Aoyou is completed, the milk powder business is expected to become a new growth engine. On the other hand, catering is impacted by the epidemic, but the sub sectors such as staple food and baking have their own power to improve penetration, and the efficiency advantage of industrialized large-scale production is more obvious under cost pressure, which deserves special attention. Zhongyin Babi Food Co.Ltd(605338) , Toly Bread Co.Ltd(603866) , Toly Bread Co.Ltd(603866) .
Baijiu: central voice and stability economy, Baijiu gradually into the layout of the opportunity. Comprehensive channel feedback and monthly business data disclosed, we believe that liquor enterprises channel fine control and control capabilities have been gradually strengthened, dealer inventory overall benign, the first quarter Baijiu sector basic worry, the current disturbance in the off-season relatively limited impact, Baijiu sector certainty is still strong. The financial committee meeting of the State Council reiterated the demand for steady growth. It is expected that the two or three quarter economic stability will stimulate consumption recovery. It is suggested that the high-end Baijiu with strong consumption and relatively small impact on the epidemic will be recommended.
Key industry data
Baijiu: this week Moutai wine wholesale price and last week slightly lower than the previous week, the price is 2995 yuan this week. In terms of loose bottles, the price of this week was 2700 yuan, slightly lower than that of last week The Wuliangye Yibin Co.Ltd(000858) lot price was stable at 965 yuan / bottle, and the Guojiao 1573 lot price was stable at 920 yuan / bottle. Food: on March 18, the price of wheat was 321222 yuan / ton, the price of corn was 282883 yuan / ton, and the price of soybean was 533895 yuan / ton. On March 18, the price of white granulated sugar was 5.79 yuan / kg. On March 18, the prices of piglets, pork and hairy pigs were 14.40 yuan / kg, 18.12 yuan / kg and 15.60 yuan / kg respectively. On March 9, the price of raw and fresh milk was 4.20 yuan / kg. On March 11, the retail price of milk powder remained basically unchanged.
Industry highlights
With the steady improvement of national consumption power, children’s food consumption investment has also promoted the “baby economy”, the sustainable development of related products, and the scale of mother and baby market has expanded to about 4 trillion. According to the report of machimang Research Institute, among children’s food categories, baby snacks have the highest sales growth, and infant condiments have the highest sales growth. For children’s snacks of the same category, natural raw materials without addition are the basic threshold for brand entry, sugar free and salt reduction is the standard configuration of the product, and comprehensive nutrition and functionality are the advanced products. Among them, the nutritional elements most concerned by parents are trace elements, dietary fiber, probiotics and prebiotics. However, there are four common problems in children’s food: the suspicion of misleading consumers in prepackaged labels, the proliferation of additives, children’s condiments belong to high sodium food, and the brand OEM is concentrated, but the R & D capacity is uneven. The brand side needs to upgrade the product experience from more dimensions, comprehensively build quality upgrading, deepen and subdivide the track of different children’s food categories, be more diversified and differentiated in product design and creation, and always take the consumer demand as the starting point to truly solve the multiple demands of consumers.
Risk tips
The risk of long-term epidemic prevention and control in China; Risks of major food safety incidents; Major agricultural epidemic risk.
