\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 519 Kweichow Moutai Co.Ltd(600519) )
\u3000\u30001. Market expansion and share growth can ensure that sales are determined by production.
Moutai is a representative of Baijiu 2000 yuan + price liquor, ten years sales volume CAGR14. 6%； The sales volume can be guaranteed by price adjustment, and the production and sales can still be determined in the future.
\u3000\u30002. Based on the growth of base liquor production capacity, support the compound annual growth of Maotai liquor sales during the 14th Five Year Plan period by 3.9 ~ 6.7%.
After 2017, the production of base liquor recovered and continued to grow; It is estimated that the marketable Maotai liquor in 2025 will increase by about 21 ~ 38% compared with that in 2020, and the annual compound is expected to increase by 3.9 ~ 6.7%.
\u3000\u30003. Rising the factory price and adjusting the structure will help the average price continue to rise during the 14th Five Year Plan period.
Considering the positioning of Maotai liquor, the prospect of China’s sustained economic growth and the fact that the market price is higher than the ex factory price, the average price is expected to continue to rise during the 14th Five Year Plan period by raising the ex factory price and adjusting the product + channel structure.
\u3000\u30004. The reform and new deal has been implemented steadily, focusing on the reform of marketing system and market-oriented price strategy.
Ding Xiongjun took office and actively promoted the reform of marketing system and price system, through inventory clearing, empty bottle replacement and “opening the gate”; Cancel the requirement that you are qualified to buy wine when you stay in Maotai hotel; Completely cancel the “unpacking order” and other measures to implement the “price control”.
The one and only investment recommendation: maintain the recommended rating: epidemic situation, economic growth fluctuation and economic structural transformation bring greater uncertainty to the Baijiu industry. However, Moutai has unique status, strong brand strength, large market price and factory price difference, holding the option to raise prices, and the ability to transfer economic fluctuations. Looking forward to the medium and long term, Maotai can raise the ex factory price to recover part of the channel interest margin. Consumption upgrading and the growth of base liquor production capacity support the growth of sales volume. The price and volume can still rise together, and the growth prospect is clear. It is still the core asset. It is estimated that the revenue from 2021 to 2023 will be 109.1/124.8/155.8 billion yuan, an increase of 11.3% / 14.5% / 24.8%, the net profit attributable to the parent company will be 52.1/600/75.9 billion yuan, an increase of 11.5% / 15.3% / 26.5%, and eps41.5% 43 / 47.77/60.42 yuan, the current PE is 42 / 37 / 29 times (corresponding to the closing price on March 23, 2022), maintaining the “recommended” rating.
Risk warning: the outbreak has repeatedly affected Baijiu consumption. Baijiu industry downturn degree of risk; Risk of business fluctuation caused by management change; Policy risk.
