1. This week, foreign capital turned to inflow, pessimism eased and the sector rebounded. On Monday, the food and beverage industry rose 2.90%, outperforming the Shanghai Composite Index (+ 2.19%) by 0.71 percentage points. This week, the two factors that led to the early fall of the sector have turned to the inflection point: first, the capital level. The North food fund has been the first net inflow of 3 billion 530 million yuan (the first tier industry ranked second) since February 18th. The net inflow of Baijiu has reached 2 billion 980 million yuan, and the core leading companies such as Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) and Anhui Gujing Distillery Company Limited(000596) have been inflow of 16.1, 4.4, 2.6 and 250 million yuan respectively. Secondly, in terms of the epidemic situation, Shanghai has entered the stage of city closure and control this week. Although the number of infected people is still rising, the implementation of various strict control measures and the rush of national medical rescue teams have strengthened the confidence to end the epidemic situation as soon as possible. Subdivision, this week, the sub sectors have risen to varying degrees, including Baijiu, processed foods and meat products, or 6.99%, 3.82% and 3.47% respectively. In terms of individual stocks, Qinghai Spring Medicinal Resources Technology Co.Ltd(600381) led the rise (+ 25.85%) this week, followed by Henan Shuanghui Investment & Development Co.Ltd(000895) (+ 10.22%), Chacha Food Company Limited(002557) (+ 7.63%), Xinjiang Yilite Industry Co.Ltd(600197) (+ 6.54%) and Tibet Development Co.Ltd(000752) (+ 6.33%) respectively.
We emphasized earlier that the Baijiu sector has basically adjusted its elastic space in recent years, and the industry fundamentals are steady. The probability of the industry in 2022 is still a structural market. It is suggested to select individual stocks from the perspective of fundamentals, valuation and expectation, and continue to be optimistic about high-end liquor Kweichow Moutai Co.Ltd(600519) , Luzhou Laojiao Co.Ltd(000568) and regional sub high-end leaders (such as Jiangsu King'S Luck Brewery Joint-Stock Co.Ltd(603369) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Kouzi Distillery Co.Ltd(603589) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Anhui Gujing Distillery Company Limited(000596) , etc.).
2. Prospect of the first quarter report in 2022:
(1) Baijiu: the regional high-end high-end performance is strong, and the first quarter results are good. In 2022, the performance of Baijiu in the Spring Festival season was in line with expectations: 1) from the price perspective, the demand for Spring Festival in 2021 was affected by the economic weakness, and the terminal sales division was diversified, and the consumption of prices was concentrated to the head. Among them, the performance of regional sub high-end leaders is the best. 2) From a regional perspective, the provinces that are less affected by the epidemic + with large population inflow benefit the most, and the leading terminals of Hui liquor and Su liquor have strong dynamic sales. 3) From the actual collection situation, each leader has basically completed the collection task in peak season. In addition, Baijiu sales in 3 and April were off-season, and the epidemic had limited impact on the short-term performance of liquor companies. Taking into account factors such as peak season performance, payment collection completion and epidemic impact, we expect that the performance of leading liquor enterprises in the first quarter will be guaranteed. At present, Kweichow Moutai Co.Ltd(600519) , Jiangsu King'S Luck Brewery Joint-Stock Co.Ltd(603369) , Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Jiugui Liquor Co.Ltd(000799) etc. have announced the performance forecast of the first quarter of 2022 or the business data forecast from January to February respectively, and the announcement data also verified our judgment.
(2) popular products: the double pressure of demand and cost is superimposed on the high base, and the performance of most enterprises in the first quarter is expected to be under pressure. Volkswagen Q1 faces two dilemmas: the impact of the epidemic and the continuous rise of commodity costs. Among them, the fermentation of the epidemic has led to many effects: 1) consumption scenes such as catering, travel and sports disappear; 2) More stringent logistics control and limited e-commerce express delivery in many places; 3) Weak demand and reduced willingness to consume. In addition, earlier in the Spring Festival this year, the performance of some companies was confirmed in Q4 last year. The performance base of Volkswagen products companies in Q1 last year was generally high, and 2022q1 is expected to be under pressure Inner Mongolia Yili Industrial Group Co.Ltd(600887) spring festival performance was strong. The operating data from January to February laid the foundation for the steady growth of Q1 performance, and the short-term impact of the epidemic in March was limited Chacha Food Company Limited(002557) during the Chinese new year, the dynamic sales are good, but due to the dislocation of the Spring Festival, the Q1 base is high, the expected revenue growth rate is high in single digits, and the profit under the effect of price increase is faster than the income end Shanghai Bairun Investment Holding Group Co.Ltd(002568) affected by weak consumer demand, adjustment of channel price system, obstruction of e-commerce logistics and other factors, the growth rate of Q1 revenue and profit is expected to be about 15% Angel Yeast Co.Ltd(600298) last year, the performance base was high, the superimposed molasses cost was high, and the expected revenue and profit were 10% / - 18% respectively. The Q1 income of condiment companies Foshan Haitian Flavouring And Food Company Ltd(603288) , Jonjee Hi-Tech Industrial And Commercial Holding Co.Ltd(600872) and others is disturbed by the epidemic. Despite the price increase, the demand for catering channels is weak, the cost is still high, and the performance is expected to be under pressure. Quick frozen Fu Jian Anjoy Foods Co.Ltd(603345) , Ligao Foods Co.Ltd(300973) also face a high performance base. At the same time, affected by the epidemic, the enthusiasm for goods preparation at end B is not high, the demand at end C is high, but the logistics is blocked, and the expected revenue and profit performance are weak Henan Shuanghui Investment & Development Co.Ltd(000895) meat products ton profit is expected to remain high, frozen meat impairment is reduced, and profit elasticity is expected to begin to appear in the second quarter.
3, industry rating and investment strategy: Overall, the trend of steady and steady improvement of Baijiu industry is maintained. The price increase of popular products has brought marginal improvement to the performance of the sector. In the long run, the market share is expected to continue to focus on leading enterprises. After the valuation falls, the investment value of leading enterprises is highlighted. Based on this, we maintain the rating of the food and beverage industry as "recommended".
Baijiu: Kweichow Moutai Co.Ltd(600519) (recommended), Luzhou Laojiao Co.Ltd(000568) (recommended), Jiangsu King'S Luck Brewery Joint-Stock Co.Ltd(603369) (recommended), Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) (attention), Anhui Kouzi Distillery Co.Ltd(603589) (recommended), Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) (recommended), Anhui Gujing Distillery Company Limited(000596) (attention), Wuliangye Yibin Co.Ltd(000858) (recommended), Xinjiang Yilite Industry Co.Ltd(600197) (recommended), Sichuan Swellfun Co.Ltd(600779) (recommended), Anhui Yingjia Distillery Co.Ltd(603198) (attention), and recommended (etc.)
Popular products: Angel Yeast Co.Ltd(600298) (recommended), Inner Mongolia Yili Industrial Group Co.Ltd(600887) (recommended), Shanghai Bairun Investment Holding Group Co.Ltd(002568) (recommended), Fu Jian Anjoy Foods Co.Ltd(603345) (concerned), Ligao Foods Co.Ltd(300973) (recommended), Foshan Haitian Flavouring And Food Company Ltd(603288) (concerned), Chongqing Brewery Co.Ltd(600132) (recommended), etc.
Short term recommendation Kweichow Moutai Co.Ltd(600519) , Xinjiang Yilite Industry Co.Ltd(600197) , prefabricated vegetable sector, etc.
4. Risk tips: 1) the recovery of catering channels affected by the epidemic is lower than expected; 2) Macroeconomic fluctuations have hindered the pace of consumption upgrading; 3) Industry policy changes lead to increased competition; 4) The price of raw materials has risen sharply; 5) Focus on the company's performance or less than expected; 6) Food safety incidents, etc.
