Market review last week:
Last week (April 6-april 8, 2022), the food and beverage sector (Shenwan) fell 1.37%, the Shanghai Composite Index fell 0.94%, the Shenzhen Component Index fell 2.20%, the Shanghai and Shenzhen 300 fell 1.06%. The food and beverage sector lost 0.43 percentage points to the Shanghai Composite Index, ranking 15th in the weekly rise and fall of Shenwan’s 31 primary sub industries.
Core view: the inflection point may be coming, and the repair market will continue
Baijiu: turning point or coming, the market will continue. Last week, the high-end Baijiu five Lu shares showed a trend of recovery. Baijiu Baijiu has been blockaded and controlled since March. However, the current volume of liquor business plans is relatively small for the Baijiu season. The high-end liquor has been established for the first quarter of the year, and the high-end liquor is still a good basic area. The sector with high valuation and revaluation and strong certainty is recommended for priority distribution. Maotai released its annual report in 2021. The revenue exceeded 100 billion yuan for the first time. The growth rate of the first quarter report in 2022 was the best since the epidemic in three years. The operating revenue / net profit attributable to the parent company were + 18% / 19% year-on-year respectively; Moutai’s e-commerce platform is on line, 4 non standard liquor purchase hot, the late Pu Fei line is expected to increase direct business share, the ton price increase to superimpose supply and demand flourishing, Moutai is the top choice for high-end baijiu. Wuliangye Yibin Co.Ltd(000858) strictly control the behavior of fleeing goods. Under the steady growth target of the whole year, we have strong determination to control quantity and support price reform Luzhou Laojiao Co.Ltd(000568) growth elasticity is large. Guojiao 1573 is expected to continue to grow at a high speed under the channel expansion. The low-end price band of Guojiao card is good, and the long-term incentive mechanism is expected to ensure the performance. Looking for the quality growth target of Baijiu liquor. The short-term epidemic situation blocks or restricts consumption scenes such as offline banquets. However, with the disappearance of the epidemic situation, offline consumption is enthusiastic, the brand potential is strong, and the wine enterprises with better channel management and terminal consumption atmosphere are expected to realize their performance growth potential.
Beer: the high-end trend is strong, and the bottom valuation of consumption has fallen, and investment opportunities appear. In the first quarter, the sales volume of leading liquor enterprises increased sharply from January to February. Although the repeated epidemic in March led to the lack of some consumption scenes, it was smooth to the whole year. If the epidemic eased in early May, superimposed the peak season and the defensive price increase and price lock of liquor enterprises to cushion the rise of raw material prices, the current price transmission is relatively smooth. With the replenishment of Q2 sales and the easing of the situation in Russia and Ukraine, the price of raw materials fluctuated slightly or there is room on the profit side, the industry is expected to realize the simultaneous rise of volume and price Tsingtao Brewery Company Limited(600600) structure upgrade significantly Chongqing Brewery Co.Ltd(600132) Wusu has a strong development momentum. The sales volume of Wusu outside Xinjiang has increased by 60% year-on-year. The industry is still at the bottom of consumption. With the decline of valuation, investment opportunities appear.
Condiment: under the disturbance of the epidemic in the first quarter, the expected performance of condiment enterprises is under pressure. From January to February, the cumulative value of the national catering revenue was 771.78 billion yuan, an increase of 8.9% year-on-year, which better supported the demand of the condiment industry. However, the downstream was seriously affected by the repeated epidemic in March. The overall demand for condiments in the first quarter is expected to be relatively weak. The rise of soybean meal and seasoning materials in the first quarter has continued to have an impact on the community, and the inventory of soybean meal and other seasoning materials has continued to rise at the same time. Superimposed with the high base performance of Q1 in 2021, the performance of a single seasoning enterprise in Q1 in 2022 is expected to be under pressure; The leading enterprises of compound condiments are also facing the deterioration of the competition pattern. The performance of Sichuan Teway Food Group Co.Ltd(603317) and others declined in 2021. However, with the efforts of destocking and developing new products, it is expected to offset some of the decline in performance in the first quarter.
Investment advice
Plate allocation: Baijiu beer dairy products snack food condiment;
Baijiu: related targets: Kweichow Moutai Co.Ltd(600519) , Wuliangye Yibin Co.Ltd(000858) , Luzhou Laojiao Co.Ltd(000568) and sub high end liquor enterprises, with great potential for development of Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) , Jiangsu Yanghe Brewery Joint-Stock Co.Ltd(002304) , Anhui Gujing Distillery Company Limited(000596) , Jiugui Liquor Co.Ltd(000799) ;
Beer: related target: Tsingtao Brewery Company Limited(600600) , Chongqing Brewery Co.Ltd(600132) , with high growth expectation in future performance;
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: risk of tightening industrial policies; Risk of epidemic spread in China; Food safety issues.
