\u3000\u3 China Vanke Co.Ltd(000002) 567 Tangrenshen Group Co.Ltd(002567) )
The number of pigs sold increased rapidly, with a 24-year target of 5 million. From 2015 to 21, the number of pigs sold by the company increased steadily from 107200 to 1542300, with a CAGR of 55.95%. In the past 21 years, the company has sold 128500 pigs per month, mainly piglets and commercial pigs. Sales were concentrated in the first half of the year, declined slightly in the third quarter and rose slightly at the end of the year. With the steady expansion of the company's production capacity, it is estimated that the company will sell 220 / 350 / 5 million units in 22-24 years, a year-on-year increase of + 30% / + 75% / + 43%.
With the help of both Meishen and Longhua, the company's production capacity has expanded significantly, and the company's long-term goal for the slaughter of pigs is 10 million. In terms of capacity layout planning, the core development areas include Hunan, Guangdong, Guangxi and Hainan, with a design capacity of 3.5 million, 3 million, 1 million and 500000; In addition, the total capacity target of Henan, Hebei, Yunnan and Gansu is 2 million. From the perspective of breeding team, the company has two breeding subsidiaries, Meishen and Longhua, which provide a solid guarantee for sufficient production capacity and efficient breeding. 1) In the past 21 years, Meishen accounted for about 80% of the company's pigs. It is estimated that the proportion of marketing in 22 years will be about 70% (including self breeding and self support and company + farmers); Due to the absence of high-cost piglet stacking efficiency and other factors, Meishen's complete cost is expected to decline significantly. 2) The company acquired 90% equity of Longhua agriculture and animal husbandry with 490 million yuan in 17 years. By the end of 21h1, Longhua had 37900 sows in stock, with revenue and net profit of 401 million yuan and 94 million yuan. In March 22, the company announced that it would continue to support Longhua to increase its production capacity by 500000, so as to realize the overall production capacity of 2 million. In the 21st year, Longhua's marketing accounted for 20%, and the complete cost was relatively excellent; From 22 to 24 years, its listing proportion will gradually increase, which is expected to account for about 30% in 22 years, and the full cost may further decline.
The capital investment rose steadily and the financial performance was stable. At the end of 201621q3, the company's new capital investment showed an upward trend of fluctuation. We estimate that the new capital investment of 21q1-3 company is about 2.168 billion yuan, a year-on-year increase of 20 years + 31%. From the perspective of cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets in the cash flow statement, 21q1-3 company spent 2.106 billion yuan and 1.14 billion yuan in 20 years. The company has continued to expand its production capacity in the past two years to achieve growth in pig slaughter and other aspects. Vertically, the company's asset liability ratio and interest bearing debt investment ratio showed an increasing trend. At the end of 21q3, they were 54% and 42% respectively, with a year-on-year increase of + 11pct and + 12pct at the end of 20. We believe that the expansion of production capacity will inevitably lead to the increase of debt ratio, but at the same time, ensuring that the financial situation is controllable is the core task of breeding enterprises in the downward process of pig cycle. Horizontal comparison of the financial situation of listed pig enterprises, we believe that the company's financial stability is in the forefront. The average debt ratio of breeding enterprises is 62%, and the median asset ratio of listed enterprises is 62%; The average quick ratio is 0.6, the median is 0.47, and the company's value is 1.31.
It is suggested that the bottom stage of the pig cycle will end and the upward cycle is bound to come. From the perspective of investment, the market goes up in hesitation, which is in line with the emotional response of the left layout of the pig cycle. We repeatedly mentioned in the series of reports on the pig cycle that the optimal time point is accessed in the loss season (e.g. 21q3), while the sub optimal time point is before the second bottom (i.e. now). Therefore, we believe that grasping the current time point is the key to investing in the pig cycle. Considering the average market value of the industry and the company's own growth rate, cost control ability, financial performance and other conditions, we give it an average market value of 12000 yuan in the first 22 years. The company sold about 2 million units in the last 22 years, with a corresponding embedded value of 24 billion yuan, and give it a "recommended" rating.
Risk tips: the risk that the trend of pig price does not meet the expectation, the risk of raw material price fluctuation, etc.
