\u3000\u30 Fawer Automotive Parts Limited Company(000030) 06 Chongqing Baiya Sanitary Products Co.Ltd(003006) )
Event: the company released its annual report for 2021, and achieved an annual operating revenue of 1.463 billion yuan, a year-on-year increase of + 16.97%; The net profit attributable to the parent company was 228 million yuan, a year-on-year increase of 24.89%, and the net profit attributable to the parent company after deduction of non-profit was 211 million yuan, a year-on-year increase of 16.83%.
Comments:
The increase in expenditure led to a decline in performance growth in the second half of the year, and the annual operating performance was in line with expectations. The company launched new products in an orderly manner throughout the year, and the Chinese market and e-commerce channels developed steadily. The annual business performance met expectations. In terms of single quarter, the company’s Q4 single quarter revenue was 379 million yuan, a year-on-year increase of + 10.17%. The growth rate was affected by the repeated epidemic in many places across the country, which was slower than that in the first half of the year. Q4 realized a net profit attributable to the parent company of 55 million yuan in a single quarter, a year-on-year increase of + 4.01%; The net profit attributable to the parent company after non deduction was 50 million yuan, a year-on-year increase of – 1.06%. The main reason for the decline in performance growth is that the company has increased the investment of brand expenses in order to speed up the pace of national market development. We believe that with the continuous growth of the company’s revenue scale, the scale effect is gradually released, and the profitability is expected to be gradually improved.
The proportion of medium and high-end products continued to increase, and the company’s comprehensive gross profit margin increased against the trend. With the sharp rise in raw material prices, the company’s annual gross profit margin remained + 2.05pcpts to 44.71% year-on-year, mainly due to the continuous optimization of the company’s product structure, and the income of free point sanitary napkins of medium and high-end products accounted for more than 95% of the company’s sanitary napkin income, which became the main driving force of performance growth. During the period, the expense rate increased from + 2.8pcpts to 27.46% year-on-year, mainly because the company increased its marketing and R & D investment. The annual sales expense rate increased from + 1.32pcpts to 19.06%, and the management and R & D expense rate increased from + 1.42pcpts to 8.59%, which comprehensively affected the annual net profit margin of the company from + 0.99pcpts to 15.32% year-on-year.
The performance of distribution channels is stable, and the growth of e-commerce channels is bright. In terms of channels, the company’s distribution / Ka / e-commerce / ODM channels achieved operating revenue of RMB 857 / 2.66 / 2.10 / 130 million respectively, with a year-on-year increase of + 21.77% / + 8.85% / + 36.81% / – 12.69% respectively. The growth rate of e-commerce channels is leading. At the same time, the company attaches importance to the construction of online e-commerce channels, and the equity incentive assessment objectives are calculated separately for e-commerce channels. It is expected that the company’s e-commerce channels will achieve an income of 338 / 491 / 690 million yuan from 2022 to 2024, providing a strong contribution to the company’s income growth and national market development.
Investment suggestion: the Chinese market is developed in an orderly manner and the brand strength is continuously improved. Taking into account the impact of the company’s efforts to expand the national market, enhance brand strength and increase cost investment on the company’s profit side, we lowered the company’s profit forecast for 2022 / 2023, and expected the company’s net profit attributable to the parent company from 2022 to 2024 to be 275 / 337 / 407 million yuan respectively (the original forecast value of 303 / 377 million yuan in 2022 / 2023), corresponding to 20 / 17 / 14 times of the current market value PE respectively, maintaining the “buy” rating.
Risk tip: the expansion of new markets is less than expected, the industry competition intensifies, and the raw material cost fluctuates sharply.
