\u3000\u3 Shengda Resources Co.Ltd(000603) 288 Foshan Haitian Flavouring And Food Company Ltd(603288) )
There is pressure in the short term and the long-term prospect is clear
Foshan Haitian Flavouring And Food Company Ltd(603288) announced that the revenue in 2021 will be 25 billion yuan, with a year-on-year increase of 9.7%; The net profit was 6.67 billion yuan, a year-on-year increase of 4.2%. In 2021q4, the revenue was 7.01 billion yuan, a year-on-year increase of 22.9%; The net profit was 1.96 billion yuan, a year-on-year increase of 7.2%. Considering the rising price of raw materials and lowering the profit forecast, it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 7.47 (- 5.7), 8.93 (- 5.2) and 10.54 billion yuan, with a year-on-year increase of 12.0%, 19.5% and 18.0%, EPS of 177 (- 0.14), 2.12 (- 0.12) and 2.50 yuan, and the corresponding PE of the current stock price is 49.6, 41.6 and 35.2 times. The company’s brand and channel advantages have existed for a long time, continuously strengthened its competitive strength, developed multiple categories, and its market share can still be expanded, maintaining the “buy” rating.
The price increase promoted the revenue growth in the fourth quarter than expected
Affected by the epidemic and disturbed by the community group purchase channels, the company failed to achieve the set goals throughout the year, but benefited from the price increase in the fourth quarter, the revenue of 2021q4 achieved an accelerated growth of 22.9%, of which the three categories achieved a total growth of 20.5% in the fourth quarter, and the growth of soy sauce, seasoning sauce and oyster sauce increased by 20.8%, 13.6% and 21.3% respectively. It is estimated that the growth of small products is faster. In the fourth quarter, the central region achieved rapid growth of more than 30%; The northern region (12.1%) performed poorly. The company gives the guideline of increasing revenue by 12% in 2022. Under the background of the epidemic disturbance and high inventory, the company’s goal is also in line with the objective reality.
Profit pressure still exists, and the company develops steadily
The gross profit margin of 2021q4 decreased by 3.7pct year-on-year, mainly due to the rise of raw material prices. The price increase in October has not been transmitted to the terminal, which has a limited effect on profit promotion. The sales expense rate increased by 4.9pct year-on-year, mainly due to the company’s increased investment in promoting channel shipments. The management expense rate and financial expense rate have little change. The overall net interest rate decreased by 4.1pct in the fourth quarter, and the profitability is under pressure in the short term. Looking forward to 2022, the price trend of bulk raw materials is rising, and the company expects the gross profit margin to decline by 0.27pct. However, under strict control, the rate of sales and management expenses has a downward trend. On the whole, the net profit should increase synchronously with the income, and remain stable under the background of the disturbance of the epidemic, which also reflects the company’s consistent steady style.
Category expansion is orderly and market transformation is accelerated
The company further refined the channels and made the market operation more flexible. The product side continues to expand. After the three major categories, vinegar and cooking wine are expected to grow in a relay. The zero added soy sauce in the new products has been put on the market, and the outlook of cola in the future; Grain and oil products have also been launched on the market. Relying on the advantages of the original channel, Haitian continues to graft new categories, and the prototype of platform enterprise has emerged. At the same time, the company accelerated the layout of new retail channels, strengthened in-depth cooperation with community group buying, and accelerated market transformation.
Risk tips: raw material cost fluctuation risk, demand decline caused by epidemic situation, market promotion is less than expected, etc
