\u3000\u30 Fawer Automotive Parts Limited Company(000030) 06 Chongqing Baiya Sanitary Products Co.Ltd(003006) )
Key investment points
Summary of performance: the company released] the annual report of 2021, and achieved revenue of 1.46 billion yuan (+ 17%) in 2021; The net profit attributable to the parent company was 230 million yuan (+ 24.9%); The net profit deducted from non parent company was 210 million yuan (+ 16.8%). Among them, Q4 company achieved an operating revenue of 380 million yuan (+ 10.2%) in 2021; The net profit attributable to the parent company was 54.578 million yuan (+ 4%), and the company’s annual revenue and operating performance increased steadily in 2021.
Gross profit margin continued to rise and profitability improved. In 2021, the company’s overall gross profit margin was 44.7% (+ 2.1pp), and the proportion of medium and high-end sanitary napkin brands with high gross profit margin continued to increase, thus driving the overall upward trend of the company’s gross profit margin. In 2021, the gross profit margin of sanitary napkins was 50.7% (+ 0.1pp) and that of diapers was 16.8% (+ 2.2pp). In terms of expense rate, the overall rate of the company in 2021 is 27.5% (+ 2.8pp). Among them, the company’s sales expense rate was 19.1% (+ 1.4pp), which was mainly due to the company’s further increase in market publicity investment in order to improve brand awareness, and the advertising expense increased by 50.2% year-on-year; The R & D expense ratio was 3.5% (+ 1.1pp). The company continued to increase investment in innovation and R & D and carried out iterative upgrading of series products, with a year-on-year increase of 70.7%; The management / financial expense ratio is 5.1% (+ 0.3pp) / – 0.2% (+ 0.06pp) respectively. In 2021, the company’s new investment income was 12.79 million yuan, which was mainly due to the income obtained by the company when it purchased financial products. Overall, the company’s net interest rate was 15.3%, with a year-on-year increase of 0.8pp. In 2021, the company achieved net operating cash flow of 200 million yuan, a year-on-year decrease of 21.3%, mainly due to the company’s strengthening brand publicity and accelerating the pace of channel expansion, the corresponding increase of various expenses, and the net cash flow remained at a healthy level.
Continue to optimize and adjust the product structure, and achieve rapid growth of medium and high-end products. In terms of products, in 2021, the company’s sanitary napkin revenue reached 1.18 billion yuan, with a year-on-year increase of 25.1%, and the proportion increased from 75.7% to 81%. Among them, the income of free point sanitary napkin of medium and high-end products accounted for more than 95% of the company’s sanitary napkin income. The growth of medium and high-end products has become one of the driving forces for the growth of the company’s performance; Diapers achieved a revenue of 150 million yuan, down 3.9% year-on-year, accounting for 10.1%, mainly due to the decline in China’s fertility rate, more fierce competition in the baby hygiene industry, and the company’s strategic slowdown in the pace of investment in baby hygiene resources; In 2021, the company’s ODM product revenue was 130 million yuan, a year-on-year decrease of 12.7%, mainly due to the company’s production line giving priority to private brand production, and the ODM business contracted accordingly. In 2021, the company carried out iterative upgrading of series products such as senseless seven days and comfortable sleep, expanded the organic pure cotton product line, and further enriched the company’s product items; At the same time, the company continued to strengthen the market promotion of medium and high-end series products and increased the sales proportion of key products. It is expected that in the future, with the continuous upgrading of market consumption concept and the adjustment of product structure, it is expected to drive the continuous growth of the sales of independent brand sanitary napkins and improve the overall profitability of the company.
The channel expansion was carried out in an orderly manner, and the e-commerce channel reform achieved initial results. In 2021, the company will expand the national market in an orderly manner. On the one hand, the company will expand market coverage through e-commerce channels. On the other hand, the company’s products will gradually expand from the existing core areas and have now entered Shaanxi, Hebei, Shandong, Hunan, Hubei, Guangdong and other regions. By region, the revenue of Sichuan and Chongqing reached 610 million yuan in 2021, with a year-on-year increase of 15.7%, and the core region still maintained rapid growth; The revenue of Yunnan Guizhou Shaanxi region reached 340 million yuan, with a year-on-year increase of 24.9%, and the market share of foreign port regions continued to increase; Other regions achieved revenue of 170 million yuan, with a year-on-year increase of 16.4%. High potential areas such as Shandong, Hebei and Guangdong are still in the process of cultivation, which is expected to continue to increase with the accumulation of brand strength and channel investment. In 2021, the company’s e-commerce channel revenue was 210 million yuan, a year-on-year increase of 36.8%. In 2021, the adjustment and reform of e-commerce channels achieved remarkable results, forming a diversified e-commerce traffic portal of direct marketing + distribution + live broadcasting. Among them, direct e-commerce companies strengthen new product promotion and brand construction, which is expected to further improve brand awareness and profit margin of e-commerce channels; Online distribution expands the brand traffic entrance and further spreads the product coverage; At the same time, the forward-looking layout of the emerging traffic entrance of live e-commerce is expected to occupy the first mover advantage in the competition of various brands. Looking forward to the follow-up, e-commerce channels are expected to become the wind vane for the company to expand its peripheral regions and gradually contribute to important revenue growth.
Profit forecast and investment suggestions. It is estimated that the EPS from 2022 to 2024 will be 0.63 yuan, 0.79 yuan and 0.96 yuan respectively, and the corresponding PE will be 21 times, 17 times and 14 times respectively, maintaining the “hold” rating.
Risk tip: the risk of sharp fluctuations in the price of raw materials, the risk that the terminal sales are less than expected, and the risk that the penetration rate of e-commerce is less than expected.
