Baijiu: epidemic impact, confidence impact, Moutai channel price dropped. March Baijiu Baijiu City, overlay the impact of various epidemic situation, the core cities to increase epidemic prevention and control efforts, logistics is affected, the demand for funds under the channel, and demand blocked, liquor prices have moved down this week, the flying box of the box on Saturday this week fell to 2890 yuan / bottle, the ring ratio fell, mainly in the first tier cities epidemic prevention and control situation is more severe, the channel is expected to become weak, and Moutai new e-commerce platform will soon be on sale. Or have an impact on the delivery volume and delivery mode of Maotai. Recently, the arrival volume of Maotai has increased, and the change of supply-demand relationship has also exacerbated the impact on the price of Maotai. For other products, the batch price of badaipu five is 965 yuan / bottle, which is relatively weak. The demand of the overall market in the off-season is poor, and the weak price reflects the pessimistic expectation of the channel. Looking ahead, we will continue to track the development of the epidemic situation and expect the recovery of consumption to stabilize the confidence of the channel and to change the space with time. For a long time, the growth of Baijiu has certain toughness. Standing at the present time, we will continue to play a role in Moutai, Wuliangye Yibin Co.Ltd(000858) and Laojiao, and propose that we should focus on the old wine leading products: Fenjiu, the Yanghe River, alcoholic spirits and so on, in the light of the certainty and low PEG dimension.
Beer: the impact of the epidemic will dissipate sooner or later, and the short-term cost pressure will not change the long-term high-end trend. Recently, there has been a certain degree of adjustment in the beer sector, mainly due to market concerns: 1) geopolitical impact, and the cost of raw materials continues to rise; 2) Under the control of the epidemic situation, the scene of beer consumption continues to be missing; 3) The high-end competition intensifies and the cost investment continues to increase. We believe that from the perspective of sales volume, the current total is no longer the main logic of the growth of the beer industry, and the upgrading of product structure under high-end is the main driving force for the sustainable growth of beer enterprises. From the perspective of high-end, major beer enterprises have arranged the second highest and above prices, among which heavy beer, Tsingtao beer and China resources have made smooth progress in the past 21 years. Beer companies have raised the prices of their main products in 21h2. It is expected that the price increase effect will be reflected in 22q2, and the upward pressure on costs will slow down throughout the year. From the perspective of the progress of high-end price, the major beer enterprises have little increase in the total amount of cost investment, more is the change of cost structure, and more channel costs are concentrated in high-end price and consumer cultivation. In addition, the competition of high-end price of beer is no longer the traditional channel competition and cost competition in the past, but more the competition of brand strength and consumer cultivation. At the current time point, the valuation of the beer sector has fallen back to the comfortable range. It is expected that with the gradual relaxation of epidemic prevention and control measures, the consumption of ready to drink channels such as catering is expected to recover. We continue to be optimistic about the higher than expected dynamic sales of beer during the peak season of Q2.
Condiment: the leading Haitian has stable performance and pays attention to Chongqing Fuling Zhacai Group Co.Ltd(002507) flexibility. Foshan Haitian Flavouring And Food Company Ltd(603288) released its annual report this week. In 2021, it achieved an operating revenue of 25 billion yuan, a year-on-year increase of 9.7%, and a net profit attributable to the parent company of 6.67 billion yuan, a year-on-year increase of 4.2%. From the revenue side, it has basically achieved double-digit growth, of which Q4 has made a contribution to the performance of pre spring festival goods preparation and price increase in a single quarter, but the performance of over 20% year-on-year growth in a single quarter is still excellent. On the profit side, it is mainly due to the rise of raw materials such as soybeans, wheat and packaging materials, which has dragged down the gross profit margin. Although the company’s expense rate has shrunk, it is still difficult to make up the gap. In 2021, the net profit margin of sales fell by 1.4pct year-on-year. According to the business plan of the annual report, the target growth rate of Haitian revenue / net profit in 2022 is 12% / 12%. Considering the market environment and cost pressure, we believe that the performance in 2021 and the target setting in 2022 are relatively stable. In 2021, the condiment industry involves multiple factors such as community group purchase, cost and epidemic situation, resulting in great business pressure; In 2022, the impact of community group buying will be weakened. At present, the impact of the epidemic on demand and the impact of cost on profitability are still in place. The industry is expected to show a weak recovery, and Haitian, as a leader, is expected to continue the repair trend. On the other hand, this week Chongqing Fuling Zhacai Group Co.Ltd(002507) held an investor exchange meeting. In 2022, the acquisition cost of young vegetable head fell back to the normal level of 800 yuan / ton, superimposed with the price increase factors. Based on the company’s announcement of the 15% revenue growth guidance in 2022, the profit elasticity in 2022 is high, so it is recommended to pay attention.
Dairy products: Miaoke maintains high-speed growth, and the epidemic situation does not change the rigid demand for dairy products Shanghai Milkground Food Tech Co.Ltd(600882) disclosed the annual report of 2021. In 2021, the company achieved a revenue of 4.478 billion yuan, a year-on-year increase of 57.31%; The net profit attributable to the parent company was 154 million yuan, a year-on-year increase of 160.6%; Deduct non net profit of 122 million yuan, an increase of 173.72% year-on-year. In terms of the gross profit margin of the split business, the gross profit margin of cheese / liquid milk / trading products was 48.51% / 13.73% / 3.9% respectively. Compared with + 3.14pct / – 4.19pct / + 1.92pct respectively in the past 20 years, the scale effect of the cheese business gradually appeared, superimposed with the growth of the sales of high margin cheese products, driving the increase of the gross profit margin of the cheese business. The “1 + N + X” strategy on the product side has been steadily promoted, with the layout of high-end new products and continuous development for 22 years. In terms of channels, at the 2C end, the company insists on “refining at low temperature and expanding at normal temperature”. At the 2B end, the company has developed more than 500 terminals such as Paris Beitian, weiduomei, Qingmei and crab champion. At the same time, the five channels of Chinese food, western food, baking, tea and industry have made breakthroughs. Due to the nutritional effect of dairy products, we believe that the epidemic does not change people’s rigid demand for dairy products, which is relatively less impacted by the epidemic, and we are optimistic about the growth of leading income of dairy products.
Snack food: the disclosure season of the annual report has arrived, focusing on the recovery of high-quality leading performance. The recent epidemic situation in many places has repeatedly affected terminal consumption, and the sector is still under pressure in the short term. However, since 21q3, companies in the leisure food sector have actively adjusted the investment of products, channels and expenses in response to the pressure of rising costs, fragmented channels and weak terminal consumption, and have achieved preliminary results. The performance disclosure period of 2021 annual report has expired, and the performance of Chacha Food Company Limited(002557) performance forecast is outstanding. It is suggested to pay attention to the performance improvement of the leading snack food companies.
Frozen baking: channel diversification is the focus of this year, and cost pressure has been paid attention to for 22 years. Affected by the epidemic in the first quarter, the purchase intention of bakeries and other channels may be suppressed to a certain extent, the price of palm oil rises, and the price trend of raw materials in the later stage deserves attention, which may affect the profit performance of the company. We believe that Ligao’s growth is not afraid to worry. Looking forward to 22 years, the supply side capacity will continue to fall, and the sales will gradually get rid of the capacity constraints; On the channel side, except Sam, the company will conduct diversified layout in baking and catering channels; On the product side, there is still great room for improvement in cassava and frozen cake; The price increase on the profit side can offset the pressure of rising costs.
Investment suggestion: Baijiu sector: the value of high-end liquor is obvious, the secondary high-end is still in the upward cycle, adhere to the growth leader, the real estate Baijiu benefited from epidemic situation, and focus on Kweichow Moutai Co.Ltd(600519) Wuliangye Yibin Co.Ltd(000858) Luzhou Laojiao Co.Ltd(000568) Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) Jiugui Liquor Co.Ltd(000799) Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) Anhui Gujing Distillery Company Limited(000596) Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) / Sichuan Swellfun Co.Ltd(600779) Anhui Kouzi Distillery Co.Ltd(603589) Beijing Shunxin Agriculture Co.Ltd(000860) . Beer sector: high-end continues to accelerate, short-term sales fluctuations do not change the upward trend of performance, focusing on Chongqing Brewery Co.Ltd(600132) / Tsingtao Brewery Company Limited(600600) / Beijing Yanjing Brewery Co.Ltd(000729) / China Resources beer / Guangzhou Zhujiang Brewery Co.Ltd(002461) , etc. Condiment sector: focus on Foshan Haitian Flavouring And Food Company Ltd(603288) / Qianhe Condiment And Food Co.Ltd(603027) / Jonjee Hi-Tech Industrial And Commercial Holding Co.Ltd(600872) / Chongqing Fuling Zhacai Group Co.Ltd(002507) / Jiangsu Hengshun Vinegar-Industry Co.Ltd(600305) etc. Dairy products sector: focus on Shanghai Milkground Food Tech Co.Ltd(600882) / Inner Mongolia Yili Industrial Group Co.Ltd(600887) / Bright Dairy & Food Co.Ltd(600597) / New Hope Dairy Co.Ltd(002946) / Mengniu Dairy industry, etc. Snack food sector: we should still focus on the main line of growth, pay attention to channel driven, and focus on Chacha Food Company Limited(002557) / Ganyuan Foods Co.Ltd(002991) / Juewei Food Co.Ltd(603517) / Zhou black duck / Yanker Shop Food Co.Ltd(002847) , etc. Frozen baking sector: under the background of rising labor costs and store rents, catalytic frozen baking dough is widely used, and the track is booming, focusing on Ligao Foods Co.Ltd(300973) / Namchow Food Group(Shanghai) Co.Ltd(605339) / Zhengzhou Qianweiyangchu Food Co.Ltd(001215) , etc. Special liquor and beverage sector: pre mixed liquor and energy drinks are good tracks in Changpo, focusing on Shanghai Bairun Investment Holding Group Co.Ltd(002568) (improved quarterly) / Eastroc Beverage (Group) Co.Ltd(605499) (exceeding the expectation in the annual report), etc.
Risk warning: macroeconomic downside risk; Food safety issues; Intensified market competition; The price increase was less than expected
