\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 132 Chongqing Brewery Co.Ltd(600132) )
Key investment points
Event: the company released]2021 annual report, realizing revenue of 13.12 billion yuan, with a year-on-year increase of 19.9%; The net profit attributable to the parent company was 1.17 billion yuan, a year-on-year increase of 38.8%. Among them, 21q4 achieved a revenue of 1.93 billion yuan, a year-on-year increase of 1.1%, and a net profit attributable to the parent company of 120 million yuan, compared with – 07 million yuan in the same period last year. At the same time, it is proposed to distribute a cash dividend of 20 yuan (including tax) for every 10 shares.
The acceleration of structural upgrading was obvious, and Wusu continued its high growth performance. In terms of volume, the company achieved an annual beer sales volume of 2.789 million tons, a year-on-year increase of 15.1%. In terms of grades, the sales volume of high-grade beer was 662000 tons, with a year-on-year increase of 40.5%. The rapid growth of high-grade beer was mainly contributed by Wusu. In 21 years, the sales volume of Wusu outside Xinjiang was about Shanghai Pudong Development Bank Co.Ltd(600000) tons, with a year-on-year increase of nearly 80%; Mainstream beer sales reached 1.614 million tons, a year-on-year increase of + 10.6%, mainly due to the double-digit growth of Chongqing and Lebao brands; The sales volume of economic beer reached 160000 tons, a year-on-year increase of + 10.7%, mainly due to the company’s continuous investment in Shancheng brand. The upgrading of the company’s overall product structure has accelerated significantly, and the proportion of high-end / mainstream / economic sales has increased from 19.4% / 60.2% / 20.3% in 20 years to 23.7% / 57.9% / 18.4% in 21 years. In terms of high-end beer, the year-on-year price is + 316 / + 1.2% / year, and the economic price of high-end beer is + 4056 / + 1.2% / year respectively; The rapid expansion of the company’s high-grade beer has driven the overall ton price to rise by 5% year-on-year to 4601 yuan / ton. With the rapid growth of the troika represented by Wusu, Chongqing and Lebao in 2022, it is expected that the high elasticity of the company’s performance will continue.
The price of raw materials continued to rise, reducing fees and improving efficiency, driving the improvement of profitability. In 2021, the gross profit margin of the company was 50.9%, with a year-on-year increase of 3.3pp, of which the gross profit margin of Q4 in a single quarter was 37.9%, with a year-on-year decrease of 11.5pp. Since 21h2, affected by the continuous rise in the prices of key raw materials such as barley and packaging materials, the overall cost side of the industry has been under pressure, and due to: 1) wine enterprises generally adopt price locking in advance to avoid raw material price fluctuations; 2) In the off-season, the demand for beer is weak, the decline in sales weakens the scale effect, and the cost pressure is prominent, resulting in obvious pressure on the gross profit margin of 21q4. In terms of cost ratio, the sales cost decreased by 1.3pp to 16.9% year-on-year. Although the company strengthened the brand launch this year, the increase of cost-effectiveness ratio led to the decrease of sales rate; The management expense ratio decreased by 2.3pp to 3.9% year-on-year, mainly due to the cost savings brought by the improvement of organizational optimization efficiency and the implementation of operation cost management projects, as well as the impact of the high base of asset restructuring expenses in 2020. Under the continuous pressure on the cost side, the company reduced costs and improved efficiency through product structure upgrading and lean management, resulting in an increase in the overall net profit margin of the whole year by 2.3pp to 18.3%.
Wusu raised prices, reshaped the price system, and continued to release the efficiency of channel reform. 1) Wusu outside Xinjiang started the price increase on February 1, and the channel feedback is that the price increase is conducted smoothly at present. On the one hand, after Wusu’s price increase, the single box profit is expected to return to the 20-year level, effectively boosting the enthusiasm of dealers; On the other hand, it is expected to alleviate the continuous upward pressure on the cost side and freight, and thicken the company’s profits. 2) In November of 21, the company started the reform of the five Bu systems, and changed from brand division to district based governance, which not only effectively cracked down on the frequent fleeing of goods in Wusu since July last year, but also gave the “6 + 6” full brand operation right to all provinces. The company is expected to take Wusu as the spear and with the continuous promotion of the big city plan, drive the medium-sized products represented by Chongqing and Lebao, quickly improve the channel penetration of the company in vulnerable regions such as East and South China, and further enhance the competitiveness of the company in the high-end beer market.
Profit forecast and investment suggestions. It is estimated that the EPS from 2022 to 2024 will be 3.07 yuan, 3.78 yuan and 4.61 yuan respectively, and the corresponding dynamic PE will be 37 times, 30 times and 24 times respectively, maintaining the “buy” rating.
Risk tips: raw material price fluctuation risk, covid-19 epidemic repeated risk, high-end competition intensified risk.
