Weekly News Express
Industry news: 1) from January to February 2022, the retail value of beverages in China was 48.09 billion yuan (+ 11.4%), and the retail value of tobacco and alcohol was 101.12 billion yuan (+ 13.6%); 2) Guizhou Baijiu output is 5.22 000 liters (+5.5%), and the liquor manufacturing industry has a 102.8% production rate (+8.6pct). 3) Guizhou has invested in 16 liquor projects with a total investment of 10.56 billion yuan.
Company news: 1) Kweichow Moutai Co.Ltd(600519) : enable the new version of logistics code label; I Maotai only sells 4 new products; Start more than 200 scientific and technological innovation projects; 2) Wuliangye Yibin Co.Ltd(000858) : we will continue to adhere to the high-end strategic brand positioning in 2022; 3) Xinjiang Yilite Industry Co.Ltd(600197) : it is proposed to invest 293 million yuan to build a wine culture industrial park; 4) Jinhui Liquor Co.Ltd(603919) : form a “Northwest + North China” double development engine.
Key information feedback this week
Kweichow Moutai Co.Ltd(600519) : in 2021, the total revenue was 109464 billion yuan (+ 11.71%), and the net profit attributable to the parent company was 52.460 billion yuan (+ 12.34%). In 2021, the sales volume was 66400 tons, an increase of 3.7% at the same time; The corresponding ton price is 1.6 million yuan / ton, an increase of 8% at the same time. In 2022q1, the total revenue was about 33.1 billion yuan, an increase of about 18% at the same time; The net profit attributable to the parent company was about 16.6 billion yuan, an increase of about 19% at the same time. In the first quarter, the company made a good start as scheduled, and the growth of revenue and profit this year has accelerated. Recently, the company launched a new e-commerce platform – “I Maotai”, which is expected to be officially put into operation on March 31. At present, four products are planned to be launched: 53 degrees 500ml Kweichow Moutai Co.Ltd(600519) wine (year of the renyin tiger), 53 degrees 500ml Maotai 1935, 53 degrees 375ml 2 (year of the renyin tiger), 53 degrees 500ml Kweichow Moutai Co.Ltd(600519) wine (treasures). Pfizer is expected to launch later. The launch of the new e-commerce platform marks the acceleration of the company’s reform process, and the company is expected to enter the fast lane.
Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) : the company expects the revenue of 2022q1 to be about 3 billion yuan, an increase of about 25% at the same time; The net profit attributable to the parent company was about 1 billion yuan, an increase of about 24% at the same time. The company made a good start as scheduled, and the overall trend is good. At present, the company’s Guoyuan series accounts for about 80%, and the V series is expected to continue to be large-scale. V3 will undertake more consumer groups of four open upgrades and follow-up capacity expansion; V9 takes advantage of the hot sauce and wine to form a sauce and wine atmosphere in the province, relying more on group purchase channels. Three highlights of the company in the future: first, the 10 billion target of V Series in the next decade, and the price band of 600700 yuan for V3 and competitive M6 + advance card; Second, the 14th five year plan for Southern Jiangsu is expected to be nearly 4 billion, with large growth space in the future; Third, the proportion outside the province in the 14th five year plan accounts for more than 20%, and the expansion outside the province is a must for the company to open the ceiling.
Vats Liquor Chain Store Management Joint Stock Co.Ltd(300755) : the revenue in 2021 was 7.46 billion yuan, an increase of 50.97% at the same time; The net profit attributable to the parent company was 676 million yuan, an increase of 81.03% at the same time; Deduct RMB 658 million from non-profit, an increase of 92% at the same time. Among them, the revenue of 2021q4 was 1.488 billion yuan, an increase of 18% at the same time; The net profit attributable to the parent company was 95 million yuan, an increase of 79% at the same time. In 2021 Baijiu sales increased 7 million 64 thousand and 200 liters (+77%), corresponding price was 900 yuan / liter (-18%), quantity contribution exceeded price. At present, the company has further improved its product structure, built a supply chain system through two pronged efforts, and carried out the procurement of famous wines and the development of fine wines simultaneously. Currently Vats Liquor Chain Store Management Joint Stock Co.Ltd(300755) stores have completed version 3.0 upgrade iteration. On the product side, at present, the company takes maowu as the drainage product, makes efforts to develop non-standard customized products, enriches the product matrix, and non-standard customized products have contributed to the profit side. On the channel side, at present, the company implements the development strategy of “small B and large c” channels, steadily expands about Shenzhen Jt Automation Equipment Co.Ltd(300400) stores every year, strengthens the concept of fidelity, and realizes customer transformation through stores and “Huazhi preferred” e-commerce platform.
Shanghai Milkground Food Tech Co.Ltd(600882) : the expected revenue in the first quarter is 1.15-1.35 billion yuan, an increase of 20.93% – 41.97% at the same time; The net profit attributable to the parent company was 55-75 million yuan, an increase of 71.72% – 134.16% at the same time. Profit growth continued to be faster than revenue growth, mainly due to: 1) closely focusing on the four core strategies of “product leading, brand occupying, channel intensive cultivation and management upgrading”, the company continued to focus on product leading development, increased investment in brand construction, and continuously promoted channel expansion and deep cultivation; 2) Advertising expenses were in the fourth quarter of last year; 3) The upgrading of the product structure of the cheese sector also contributed to the new normal temperature cheese sticks and cheese slices. In 2022, the company will take four major measures to ensure the realization of its objectives: 1) further enrich the cheese product structure and create a cheese category leader. 2) Strengthen brand building and upgrade the mental positioning of consumers. 3) We will continue to build an all channel marketing system and expand our network coverage. 4) Continuously improve the management level and lay a solid foundation for sustainable development.
Yihai Kerry Arawana Holdings Co.Ltd(300999) : the company plans to grant 29.8 million restricted shares, accounting for 0.55% of the total share capital, to 1635 directors, supervisors, senior executives and core backbones at a price of no less than 30.76 yuan per share. The performance assessment requirements are: the total product sales volume from 2022 to 2023 shall not be less than 90.2 million tons, the total product sales volume from 2022 to 2024 shall not be less than 137.25 million tons, and the total product sales volume from 2022 to 2025 shall not be less than 185.8 million tons. It is estimated that the sales volume from 2022 to 2025 will be about 44.57 million tons, 45.66 million tons, 46.78 million tons and 47.92 million tons, and the four-year CAGR will be about 2.5%. Since the overall average unit price CAGR from 2017 to 2021 is about 6%, assuming that the average price continues to increase at this rate, the revenue growth rate from 2022 to 2025 is expected to reach more than 8.7%. And this time, there are many incentive personnel, which can maximize the binding of the core management and improve the enthusiasm of the overall employees, so as to further stimulate the business vitality of the company. Optimistic about the company’s continued deep cultivation in the original business, the central kitchen and condiment project will become the new point of the company’s performance, and the implementation of equity incentive will effectively stimulate the company’s business vitality.
Sichuan Teway Food Group Co.Ltd(603317) : in general, strengthen sales standardization, introduce IPD solidified product development process, and refine brand construction. 1) The cost is generally controllable, and there is no price adjustment plan at present. 2) In terms of products, we will firmly expand non spicy soup, and maintain a stable growth in customized meal recipes. 3) In 2022, there was no assessment requirements for development dealers, and the hierarchical operation mode of excellent and supporting dealers was launched to improve the operation indicators and quality of dealers. 4) In terms of marketing, external employees are introduced, new and old teams are matched, precision marketing is carried out, and “thousands of cities and thousands of stores” are continued. 5) The gross profit margin in 2022 is the same as that in 2021. The year-on-year growth of operating revenue is no less than 15% and the growth of net profit is no less than 30%.
Zhou Heiya: the revenue and profit increased both in January and affected by the epidemic in February. Adhering to the sustainable development strategy, focusing on small and beautiful, the gross profit margin remains above 55%. 1) It is expected that 1000 new stores will be opened in 2022. There are 400 franchisees, and the closing rate is in the low single digit level. 2) Adhere to the small and beautiful store opening mode, create new popular products, and take out can enable store revenue. 3) Last year, the operating profit margin was about 20%, with an overall increase of 3%. Franchising, Internet and takeout businesses are higher than direct sales. 4) Community stores are an important strategy in the future, with more than 200 last year and more than 500 this year.
5) The franchise will return the capital within 18 months. Last year, the average return on investment cycle was about 16 months. 6) The contingent equity incentive plan will be launched in 2022.
Yanker Shop Food Co.Ltd(002847) : the sales in the first quarter should be the same as last year. 1) The price rise of raw materials has eased, and the gross profit margin is basically the same in 2022. The scale advantage helps to improve the gross profit margin. 2) Maintain scale growth in the early stage and improve the net interest rate through fine operation in the later stage. 3) Price increases may be possible, mainly depending on the cost. 4) From January to February, the counter was not put into operation much, and the promotion speed was normal in March. 5) In 2022, various channel strategies will take shape and transform to all channels. 6) This year, the planned proportion of quantitative + circulation equipment is more than 15%. Dealers mainly increase this channel, most of which are concentrated in third tier cities. It is expected that the volume of revenue will double and the number of dealers will increase by about 50%.
Nongnongshan spring: from January to February 2022, the sales were good, with a slight impact in March. The impact of the epidemic is expected to last until April. There is no large-scale price increase plan, double-digit growth will be achieved throughout the year, and the gross profit margin is expected to be the same as that in 2019. 1) The freight has increased, which is controllable as a whole. The cost of pet is high, and it should be controlled below 30% as far as possible. 2) The number of medium, large and small packages increased by about 20% last year. 3) The follow-up promotion of Changbai water will be strengthened, and the tea making water will be invested for a long time. Two new flavors will be introduced for soda making water, and the amount of milk tea will be large in winter. Scream isoosmosis in functional drinks still needs to be cultivated. Dimension water is used as a channel to sink, and NFC juice is growing rapidly. 4) Regional inequality is improved, and sesame shop adapts measures to local conditions.
Chongqing Brewery Co.Ltd(600132) : the revenue in 2021 was 13.119 billion yuan, an increase of 19.90% at the same time; The net profit attributable to the parent company was 1.166 billion yuan, with an increase of 38.82% (data in the pro forma statement) and 8.30% (data legally disclosed). Among them, the revenue of 2021q4 was 1.933 billion yuan, an increase of 1.08% at the same time; The net profit attributable to the parent company was 122 million yuan, with a pro forma caliber of – 07 million yuan in the same period last year, turning losses into profits year-on-year. In 2021, the sales volume of beer was 2.7894 million kiloliters, an increase of 15.1% at the same time; Among them, the sales volume of beer in 2021q4 was 372600 kiloliters, a decrease of 2.1% in the same period, which was caused by the impact of the epidemic in the fourth quarter. The volume and price continued to rise simultaneously, and the high-end process was significant. Among them, the sales volume of high-grade wine was 661500 kiloliters (with an increase of 40.5%), and the corresponding price was 7100 yuan / kiloliter (with an increase of 3%). 2022 is the year when the company’s Yangfan 22 strategy ends. The company has released Yangfan 27 strategy on February 3, 2022. Optimistic about the company’s high-end + National Space and the continuous release of performance under the optimization of product structure.
Tsingtao Brewery Company Limited(600600) : the company’s revenue in 2021 was 30.167 billion yuan, an increase of 8.67% at the same time; The net profit attributable to the parent company was 3.155 billion yuan, an increase of 43.34% at the same time; Non deduction was 2.21 billion yuan, an increase of 21.54%. Among them, the revenue of 2021q4 was 3.395 billion yuan, an increase of 1.7% at the same time; The net profit attributable to the parent company was -455 million yuan, an increase of 41% at the same time. The loss in the fourth quarter was caused by the impact of the epidemic superimposed on the amortization of fixed costs in the off-season. The main brands continue to rise in both volume and price, and the sales of high-grade wine are bright. The total sales volume of beer was 7.93 million kiloliters (with an increase of 1.38%), and the corresponding price was 3700 yuan / kiloliter (with an increase of 6%). In 2022, the company will continue to promote the brand strategy of ” Tsingtao Brewery Company Limited(600600) main brand + the second brand of Laoshan beer”. The established high-end process will remain unchanged, and the product structure will continue to be optimized.
Investment view
Baijiu: because of the serious epidemic situation in China, especially in Shanghai, Tomb Sweeping Day is the same as daily life. It is expected that 51 may be in the low peak of consumption. If the May 1 year is back to normal, the annual impact of Baijiu is controllable, and it is expected to affect the number of digits. Maotai released the forecast of the first quarterly report of 2022. The first quarterly report is still strong, and the effect of Dinghai Shenzhen is obvious Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) also released a quarterly forecast, which is still growing steadily. We believe that the whole Baijiu season is the first to start a successful start. However, the current market sentiment is cautious and worried about the sustainability of the second quarter results. From the past quarter, fundamentals are important underpinning factors. Once the epidemic is improved, the subsequent valuation can be fixed. We hope the subsequent Baijiu sector will rebound.
Popular products: this week Sichuan Teway Food Group Co.Ltd(603317) , Zhou Heiya, Yanker Shop Food Co.Ltd(002847) , nongnongshan spring, Tsingtao Brewery Company Limited(600600) and Chongqing Brewery Co.Ltd(600132) released their annual reports for 2021. On the whole, the trend is good. However, due to the impact of the epidemic, it is generally reported that the first quarter, especially in March, was affected by the epidemic and needs to be observed as a whole. At present, under the background of rising raw materials and weak demand, the market is worried about the performance of overvalued stocks. We also suggest to actively pay attention to enterprises with undervalued and declining cost side, continue to pay attention to the transmission progress of price increase of beer and condiments, and actively pay attention to the structural opportunities of snack food.
On the whole, our view remains unchanged: at this stage Baijiu sector we recommend three high-end wine giants ( Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) ), three high-end three swordsmen ( Shede Spirits Co.Ltd(600702) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Jiugui Liquor Co.Ltd(000799) ), real estate wine, four gentlemen ( Anhui Kouzi Distillery Co.Ltd(603589) , Anhui Yingjia Distillery Co.Ltd(603198) , Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) and Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) ). We recommend Chongqing Fuling Zhacai Group Co.Ltd(002507) , Chacha Food Company Limited(002557) , Inner Mongolia Yili Industrial Group Co.Ltd(600887) , etc. in the popular products sector, and continue to pay attention to the structural opportunities in the food sector. Maintain the “overweight” rating of the food and beverage industry.
Risk tips
Risk of epidemic fluctuation; Macroeconomic fluctuation risk; Recommend the risk that the company’s performance is less than expected; Industry competition risk; Food safety risks; Risk of changes in industrial policies; Consumption tax or production risk; Raw material price fluctuation risk.
