Report guide
Recently, the State Administration of market supervision and the State Standardization Administration approved the compulsory national standard for electronic cigarettes (GB 417 Shanghai Kehua Bio-Engineering Co.Ltd(002022) ), which will be implemented from October 1, 2022. From October 1, all e-cigarette products must be produced in accordance with the national standard, limited addition of 101 additives allowed in accordance with the national standard, and enter the national transaction management platform for sales and circulation. On April 13, the State Administration of market supervision and administration and relevant departments of the state tobacco monopoly administration answered relevant questions of public concern.
Key investment points
The implementation time is October 1. A long buffer period is reserved for steady transition. From the content point of view, the officially approved national standard is basically consistent with the second exposure draft issued in March, emphasizing that only tobacco flavor (101 additives can modulate tobacco flavor with different flavors), nicotine concentration 2% limit, anti child start protection function, and shall not be operated in the form of exclusive stores. The idea is still centered on the protection of minors Reduce the attractiveness of the product. The market had expected that the official implementation of the national standard of e-cigarette would not be later than May 1, the implementation date of the measures for the administration of e-cigarette, but the implementation time officially announced this time is October 1. During the transition period, the memory management entities can continue to carry out business activities, leaving a long buffer period for the e-cigarette industry. At the same time, e-cigarette manufacturers will orderly develop new products that meet the requirements according to the national standard and guide the transition of consumer demand to these new SKUs, Avoid steep falls in the market.
Production, channels and other links will be standardized, and good money will expel bad money. (1) production side: the national standard of e-cigarette sets high requirements on the standard technical parameters and safety of products, and we expect that in the following may, all production enterprises will begin to submit production license application materials to the Tobacco Bureau, and the large factories represented by SIMORE will be the first to obtain production licenses.
(2) channel side: from June 1, 2022, the main body of the stock e-cigarette retail market can submit an application for a tobacco monopoly retail license to the local tobacco monopoly administrative department at the prefecture, municipal and county levels where its business place is located. Some phenomena of narrow spacing between school side stores and stores will be cleared up.
(3) electronic trading platform: from June 15, 2022, electronic cigarette related production enterprises, wholesale enterprises and retail market entities that have obtained tobacco monopoly related licenses will gradually trade electronic cigarette products that have passed the technical review on the platform to ensure the transparency, openness and traceability of the electronic cigarette market.
(4) subsequent introduction rhythm: in addition to the clear time node of the national standard and management measures for e-cigarettes, the competent authorities will publish relevant policy documents such as license management, technical review and product traceability of e-cigarettes, successively introduce supporting policies and implementation rules such as quality supervision and random inspection, identification and testing and product packaging of e-cigarettes, and coordinate relevant departments to study and formulate warning signs, inspection and testing institutions, taxes Relevant policies such as delivery and inbound carrying, and establish and improve the supporting policy system.
In the medium and long term, there is still a need to lay a foundation for harm reduction in the Chinese market, with equal emphasis on supervision and encouraging innovation. On April 8, a Tobacco Monopoly Bureau has initiated e-cigarette policy measures (for Trial Implementation) to all provincial units. The management ideas of the detailed rules follow the previously issued e-cigarette management measures, but their attitude is relatively positive. There are several points worthy of attention: (1) to achieve the balance between supply and demand under total amount management; (2) Strengthen the follow-up study of international standards and foreign advanced standards, and promote the integration of Chinese and foreign standards; (3) We will strengthen the tackling of key technologies such as atomizers, improve the overall technical level of the electronic cigarette industry, and encourage the automatic production of cigarette bombs and fittings in the whole process. It can be seen that while clarifying and strict supervision, the competent authorities also show great attention to the healthy development of e-cigarette industry and encourage and support its future technological innovation.
In the short term, although banning the sale of flavored e-cigarettes (currently accounting for about 90% in China) will suppress the demand side, the bottom logic of the long-term penetration of e-cigarettes needs to be paid attention to is still harm reduction, and the original intention of the state is to protect minors from infringement; With reference to the United States, the 20q4 market has begun to stabilize and 21q1 has rebounded after the taste tobacco ban came into effect in January 20.
Investment suggestion: pay attention to the long-term value of high-quality targets in the industrial chain. After the boots are landed, the bottom signal is obvious. Under more stringent standards and norms, brand leaders with strong technical strength still deserve attention. At present, the market value of SIMORE international continues to decline. This year, its overseas business has grown well. Disposable products + medical beauty atomization products are about to be sold in large quantities, paying attention to the long-term value of the company. At the same time, focus on the high-quality targets of China tobacco industry chain Shenzhen Jinjia Group Co.Ltd(002191) , Huabao international, Anhui Genuine New Materials Co.Ltd(603429) , etc.
Risk tips
The strength of policy control exceeded expectations and the industry competition intensified.
