Key investment points:
Important announcements of listed companies
Shanghai Milkground Food Tech Co.Ltd(600882) : the announcement of performance increase in the first quarter of 2022 was issued, and the net profit attributable to the parent company is expected to increase by 71.72-134.16% year-on-year
Tsingtao Brewery Company Limited(600600) : the 2021 annual report of Tsingtao beer company was released, and the net profit attributable to the parent company increased by 43.3% year-on-year
Foshan Haitian Flavouring And Food Company Ltd(603288) : the annual report of 2021 was released, and the net profit attributable to the parent company increased by 4.18% year-on-year
Industry key data tracking
In terms of dairy products, the price of fresh milk fell slightly. As of March 23, 2022, the average price of raw and fresh milk in the main producing areas was 4.18 yuan / kg, with a slight decrease month on month and a year-on-year decrease of 2.60%.
In terms of meat products, the prices of piglets, pigs and pork began to rise at the bottom in May 2019 and continued the rising trend. The prices began to decline significantly around November last year, and the downward trend of pork prices was established in the medium term. At present, pork prices are at the bottom stage. The price of pork in Guangdong Province was RMB 72.00 yuan / kg, and that of pigs in Guangdong Province was RMB 18.48-24.48% and that of pigs in Guangdong Province was RMB 12.00-12.00 yuan / kg, respectively, with year-on-year changes of – 48.48% and – 24.48% respectively.
Investment advice
This week, the food and beverage sector continued to decline, with the earlier strong Baijiu sector leading the way. The recent decline of Feitian Maotai’s rating has triggered market pessimism, which has frustrated the sector. On the one hand, the current round of price decline is related to the expectation caused by the epidemic, which makes some dealers choose to take the initiative to destock; On the other hand, it is also related to the company’s continuous reform of supply channels, launching the official self operated app, continuing to increase the proportion of direct sales and improve the supply structure. We believe that the price fluctuation has not affected the actual operation of the company, and the contradiction between supply and demand still exists for a long time. In addition, as the sector continues to decline, some leading valuations in high-quality segments have long-term allocation value. In the medium term, we still recommend that we must focus on the more high-end Baijiu, and change the space with time, and pay attention to the secondary high-end market. In terms of popular products, it is still recommended to optimize the dairy industry with downward cost determination during the year and the beer sector with relatively better competition pattern and smoother pressure transmission. The beer sector will continue to benefit from the gradual recovery of consumption scenes after the epidemic, with the positive impact of price increase and high-end products, and high growth is expected. To sum up, we temporarily give the industry a “neutral” investment rating and recommend Wuliangye Yibin Co.Ltd(000858) ( Wuliangye Yibin Co.Ltd(000858) ), Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) ( Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) ), Chongqing Fuling Zhacai Group Co.Ltd(002507) ( Chongqing Fuling Zhacai Group Co.Ltd(002507) ), Chongqing Brewery Co.Ltd(600132) ( Chongqing Brewery Co.Ltd(600132) ) and Inner Mongolia Yili Industrial Group Co.Ltd(600887) ( Inner Mongolia Yili Industrial Group Co.Ltd(600887) ).
Risk tips
Macroeconomic downside risk; Risk of major food safety incidents.
