\u3000\u3 China Vanke Co.Ltd(000002) 677 Zhejiang Meida Industrial Co.Ltd(002677) )
Core view
Event: the company released its annual report for 2021, and achieved an annual operating revenue of 2.164 billion yuan, a year-on-year increase of + 22.19%; The net profit attributable to the parent company was 665 million yuan, a year-on-year increase of + 22.28%; The net profit attributable to the parent company after deduction was 635 million yuan, a year-on-year increase of + 17.21%; It is proposed to distribute a cash dividend of 6.60 yuan (including tax) for every 10 shares.
Comments:
The integrated stove maintained a high boom and its business performance was in line with expectations. By category, the company’s integrated stoves and cabinets achieved annual revenue of 1.968/59 billion yuan respectively, with a year-on-year increase of + 24.89% / + 35.67% respectively. The company’s performance grew steadily. On the one hand, the high prosperity of the integrated stoves industry led to the improvement of the company’s product sales. According to ovicloud, the retail volume and retail volume of China’s integrated stoves in 2021 were 3.04 million units and 25.6 billion yuan respectively, with a year-on-year increase of + 28% / + 41% respectively. The integrated stoves industry as a whole showed an adverse growth trend; On the other hand, the company continues to increase technological innovation and product iterative upgrading, and further enriches product categories through the launch of sky series, star series, X series and wardrobe and household products. With the steady progress of diversified marketing and channel construction, the operation effect of dual brands is remarkable.? The effect of fee control is good, and the profitability is relatively stable. Affected by the rising price of bulk raw materials, the company’s gross profit margin in 2021 was – 1.07pct to 51.69%. The company strengthened the efficiency of operation and management, and the annual sales, management and R & D expense rates were + 0pct / – 0.20pct / + 0.09pct to 11.22% / 3.29% / 3.16% respectively. The comprehensive impact on the annual net profit margin was + 0.02pct to 30.72% year-on-year. Under strong expense control, the company’s net profit margin increased slightly.
Steady progress was made in channel construction, and the dual brand strategy was accelerated. In offline channels, 1) distribution: cultivate dealers to open more stores and improve the output capacity of a single store. During the year, more than 300 primary dealers / terminal stores were added, and the cumulative number of primary dealers / terminal stores reached more than 1900 / 2800; 2) Ka: about 330 / 195 / 320 chain home appliance stores / building materials stores / sinking channel outlets were added during the year, and more than 2500 stores were accumulated in Ka stores of home appliances and building materials; 3) Home decoration: further strengthen the cooperation with real estate developers and home decoration companies. During the year, more than 10 hardbound projects were successfully signed and installed with Guorui real estate and other real estate companies, and the sales of Engineering channels increased rapidly. In addition, the company accelerated the dual brand operation and vigorously carried out the investment promotion and store opening of “tianniu” brand. During the year, the brand of tianniu added 68 first-class dealers / terminal stores / 55.
Investment suggestion: optimize the marketing layout, make efforts in dual brand operation, and maintain the “buy” rating. The company is a leading enterprise in the integrated stove industry. It always adheres to product innovation and channel optimization, leading Wuxi Online Offline Communication Information Technology Co.Ltd(300959) to accelerate the integration. Under the dual brand operation, the company is expected to continuously improve its brand strength. We maintain the company’s profit forecast. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 802 / 941 / 1034 million respectively, corresponding to 12 / 10 / 9 times of the current market value PE respectively, maintaining the “buy” rating.
Risk tip: the development of new products is less than expected, the epidemic situation in China is repeated, and the price of raw materials is rising.
