\u3000\u30 China High-Speed Railway Technology Co.Ltd(000008) 95 Henan Shuanghui Investment & Development Co.Ltd(000895) )
Event: the company disclosed the annual report of 2021. In 2021, the company realized revenue / net profit attributable to parent company / deduction of net profit not attributable to parent company of 66.682/48.66/4.434 billion yuan, a year-on-year increase of -9.72% / - 22.21% / - 23.22%. Among them, 21q4 achieved revenue / net profit attributable to parent company / deduction of net profit not attributable to parent company of RMB 15.724/14.131354 billion, a year-on-year increase of -13.30% / + 7.28% / + 12.68%.
The sales volume of meat products decreased slightly, the benefit cost decreased, and the profit of 21q4 tons increased significantly. In terms of meat products, the revenue of 21q4 was - 2.7% year-on-year, of which the sales volume remained stable at - 0.31% year-on-year, and the annual sales volume was - 1.8% year-on-year, mainly due to: 1) the price of 21h2 pig fell rapidly, and some small and medium-sized enterprises in the industry attacked the market with low prices, resulting in intensified competition, but the company did not reduce the price due to market investment, resulting in a decline in the sales volume of ordinary products, and the growth of high-end products was difficult to offset; 2) The structural adjustment of new products was less than expected, which led to a slight decline in the sales of meat products as a whole. Considering the continuous information construction and market investment of the company and the low base of new products, we expect the sales volume of meat products to maintain single digit growth in 2022. The price of 21q4 tons increased by + 1.2% year-on-year, benefiting from the decline of pig and chicken prices and the opening of profit space. As a result, the profit of Q4 tons increased by 23.8% year-on-year to 4086 yuan, up 3.4% month on month. Given that the pig price is expected to remain low in 2022, we expect that the ton profit of meat products in 2022 may be higher than that in 2021 as a whole.
The slaughtering business has declined and may increase in volume in 2022. In terms of slaughtering business, the revenue of 21q4 was 9.44 billion yuan, a year-on-year increase of - 23.4%, including 8.348 billion yuan in foreign transactions and 1.093 billion yuan in inter segment transactions, a year-on-year increase of - 22.6% / - 29.5% respectively. Slaughter profit was 430 million yuan, a year-on-year increase of + 13.0%, mainly due to the reversal of some provisions for impairment of frozen meat after the recovery of Q4 pig price. The slaughtering volume of 21q4 was about 2.8 million, with a year-on-year increase of + 17%. The company continued to digest the high priced frozen meat, thus reducing the slaughtering volume. According to the annual report, it is expected that the pig price will run low in 2022, so the slaughtering business is expected to continue in large quantities. We expect that the slaughtering volume may be close to the level in 2018 and realize the simultaneous rise of volume and price. At the same time, as the inventory of high priced frozen meat is almost digested, the impairment is expected to be significantly reduced and the profit of slaughtering business will be further thickened.
Investment suggestion: we estimate that the company's revenue from 2022 to 2024 will be 73.26 billion yuan, 81.63 billion yuan and 90.32 billion yuan respectively, and the net profit will be 6.658 billion yuan, 6.788 billion yuan and 7.825 billion yuan respectively. We maintain the investment rating of Buy-A, and the 12-month target price is 31.26 yuan, which is equivalent to the dynamic P / E ratio of 16x in 2023.
Risk tip: the downward trend of pork is less than expected, resulting in cost pressure; The promotion progress of new products is less than expected; Food Safety; The recovery of the epidemic was less than expected.
