Weekly report of food and beverage industry: Maotai wholesale price rebounded and stabilized, and market confidence repaired or appeared

Market review last week:

Last week (March 28-April 1, 2022), the food and beverage sector (Shenwan) rose 2.9%, the Shanghai Composite Index rose 2.19%, the Shenzhen Component Index rose 1.29%, and the Shanghai and Shenzhen 300 rose 2.43%. The food and beverage sector outperformed the Shanghai Composite Index by 0.71 percentage points, ranking 12th among the weekly rises and falls of Shenwan's 31 primary sub industries.

Core view: Maotai's wholesale price rebounds and stabilizes, and market confidence is restored or revealed

Baijiu: Moutai's price rises and stabilizes, and market confidence is restored or manifested. Recently, the wholesale price of Maotai has rebounded and stabilized, and the market confidence has been boosted. Baijiu Baijiu Baijiu Baijiu in the short term, 3 and April, the performance of the Baijiu liquor in the 2020 was affected by the outbreak of the liquor in the second session, and the short-term blockade had a impact on the growth of the quarterly performance. But the length of the liquor extended to the whole year. The high-end liquor benefited from the cyclical resistance, and the growth of the performance was good. The fluctuation of the consumption scenario of the sub high end liquor and regional liquor was more intense, but the consumption after the epidemic was repaid to release a large demand. The growth of sub high-end liquor enterprises with excellent growth still has a bright performance in the whole year. Standing in the present, the high-end Baijiu 2022 steady growth is strong, and high-end Baijiu five Lu 2022 corresponds to PE only 36X/23X/28X, the best basic valuation discount proposal is optional configuration. Maotai released its 2021 annual report, setting the target of total operating revenue in 2022 to increase by about 15% year-on-year. At the same time, the e-commerce platform "I Maotai" was launched, the implementation of the company's market-oriented and digital reform objectives was strong, the proportion of direct sales was increased, and the ton price and unique brand moat were escorted by the volume and price rise of Maotai in 2022. The growth of sub high end Baijiu immediately after the demand rebounded in 2020, and its growth rate was fast. The net profit growth of Fenjiu in / Jiugui Liquor Co.Ltd(000799) 2020 was 64.14%/47.24%. In 2022, when the epidemic situation dissipates, wine enterprises with high growth, channel management and terminal consumption atmosphere are expected to realize their performance growth potential. Related objects: Shede Spirits Co.Ltd(600702) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Jiugui Liquor Co.Ltd(000799) , Anhui Gujing Distillery Company Limited(000596) , Anhui Yingjia Distillery Co.Ltd(603198) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , etc.

Beer: no fear of cost pressure, beer or meet configuration opportunities. The cost side pressure restricting the beer sector has been basically broken by beer enterprises one by one through the locking of raw material prices. The transmission of price increase in the industry is relatively smooth, the high-end logic is clear and the expectation of price increase in the future can bring about the improvement of ton price. Although the short-term epidemic repeatedly led to a slight pressure on demand, the long-term high-end process was strong, and the beer sector ushered in allocation opportunities Tsingtao Brewery Company Limited(600600) released the annual report of 2021. The momentum of the main brand improved and boosted the sales volume. The sales volume of the main brand increased by 11.60% year-on-year. White beer and Pearson showed a good momentum. Throughout the year, affected by the high level of upstream raw materials last year, the cost of the company increased, but the company took the initiative to raise the price and optimize the product structure, and the ton price and gross profit margin increased significantly. Related targets: Chongqing Brewery Co.Ltd(600132) , China Resources beer, Tsingtao Brewery Company Limited(600600) , whose sales are less affected by the local epidemic.

Condiments: the competition of compound condiments is intensifying, and the leading enterprises need to break the situation urgently. In 2020, the short-term demand for compound condiments increased rapidly, and the high base dragged down the year-on-year growth of the industry in 2021. At the same time, the competition in the segment track industry intensified and the pressure on the cost side was large. Leading enterprises enhance their competitive advantage by optimizing product structure, strengthening channel and brand construction Sichuan Teway Food Group Co.Ltd(603317) due to factors such as high base, high inventory and high cost investment, the annual revenue in 2021 was RMB 2.026 billion, a year-on-year decrease of 14.34%, and the net profit attributable to the parent company was RMB 185 million, a year-on-year decrease of 49.32%.

Investment advice

Plate allocation: Baijiu beer dairy products snack food condiment;

Baijiu: related targets: high-end liquor enterprises Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) and sub high-end liquor enterprises in the development potential of Fenfen, Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Gujing Distillery Company Limited(000596) , Shede Spirits Co.Ltd(600702) , Jiugui Liquor Co.Ltd(000799) , Anhui Yingjia Distillery Co.Ltd(603198) ;

Beer: related targets: Tsingtao Brewery Company Limited(600600) with optimized product structure and Chongqing Brewery Co.Ltd(600132) with large amount of ussu;

Dairy products: relevant subject matter: Inner Mongolia Yili Industrial Group Co.Ltd(600887) , which makes concerted efforts in production capacity, channels and products.

Risk warning: Baijiu price rise less than expected, terminal demand fell, food safety issues.

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