\u3000\u3 Shengda Resources Co.Ltd(000603) 369 Jiangsu King'S Luck Brewery Joint-Stock Co.Ltd(603369) )
Event: the company released the annual performance report of 2021. In 2021, the company achieved revenue / net profit attributable to parent company / deduction of net profit not attributable to parent company of RMB 6.406/2.029/2.033 billion, a year-on-year increase of + 25.12% / + 29.50% / + 30.50%, and 21q4 revenue / net profit attributable to parent company / deduction of net profit not attributable to parent company of RMB 1.073/3.30/331 billion, a year-on-year increase of + 15.81% / + 30.39% / + 29.45%.
Stable operation, high growth and flexible release of profit margin. Overall, the indicators of the company are commendable. In 2021, the company's gross profit margin was 74.61%, with a year-on-year increase of + 3.50pct, mainly due to the upgrading of product structure; The sales expense ratio was 15.10%, with a year-on-year increase of -1.99pct, mainly due to the decrease of advertising expenses; The rate of administrative expenses was 4.50%, with a slight decrease of 0.41 PCT; The annual net interest rate was 31.68%, year-on-year +1.08%, and the net interest rate of main business excluding investment income was 29.78%, year-on-year +4.98%. From the perspective of quarterly statements, the elasticity of net profit margin was released from the third quarter, mainly due to high-end. In 2021, the net cash flow from operating activities / contract liabilities were 3.024/2.067 billion yuan, a year-on-year increase of + 170.31% / + 88.59%. In absolute terms, the contract liabilities increased by 971 million yuan year-on-year at the end of the 20th year and 1.206 billion yuan month on month (MOM) compared with 21q3, indicating that the actual operation of the company is stronger than the apparent growth rate and the reservoir is sufficient. The company has determined that in 2022, the revenue will be 7.5 billion and strive for 8 billion, and the net profit will be 2.25 billion and 2.35 billion. According to the 21-year plan and completion, it is expected that the revenue will achieve the goal and the profit will exceed the expectation.
The product structure continued to upgrade and the expansion outside the province was smoothly promoted. In terms of products, the revenue of special a + category / special a category / a category / B category / C category in 21 years was 4.17/17.1/2.6/1.4/0.8 billion yuan respectively, with a year-on-year increase of + 35.7% / + 14.1% / + 4.4% / - 13.3% / - 9.8%, the proportion of special a + category increased 5pct to 65%, the product structure continued to upgrade, and the proportion of secondary high-end and above main products increased significantly. At the same time, from the tracking situation, the brand momentum of Guoyuan Sikai and other products was strong, the self-point rate of consumers was high, and the performance was guaranteed. Specifically, Guoyuan V series has achieved remarkable results in tackling key problems, realizing rapid and large-scale production, which not only improves the company's brand image, but also brings greater profit elasticity; Guoyuan's new fourth opening has passed smoothly, and the channel profit has improved. In terms of sub regions, the revenue inside / outside the province increased by 24.4% / 36% in 2021, accounting for 7.0% of the revenue outside the province, with a year-on-year increase of + 0.6pct. The slow growth outside the province is related to the external environment and the company's focus on price adjustment of products in the province; In 2021, the company had a net increase of 103 dealers and 15 / 88 dealers inside / outside the province respectively, and the progress of investment promotion outside the province was smoothly promoted.
The restructuring of the brand business department is of great significance, and the V99 alliance improves the joint force of manufacturers. According to the company's public exchange of information, the company will orderly establish V9, Guoyuan, Jiangsu King'S Luck Brewery Joint-Stock Co.Ltd(603369) three brand business departments and Gaogou sales company, which is of great significance. Previously, the management functions of the company's sales department were separated or even balanced with each other due to different products and regions, resulting in the weak overall promotion and marketing ability of the company. If the corresponding management functions are divided uniformly according to products, it may be conducive to the company's systematic promotion of marketing measures. In addition, the company has newly promoted the V99 alliance system and selected 99 V-series dealers inside and outside the province to provide one-to-one market guidance, professional skill training and other empowerment, so as to achieve win-win cooperation through value creation and right sharing. The establishment of V99 alliance may help V-series become another growth pole.
The new chairman is more pragmatic and conducive to the systematic reform of the company. The company adjusted the chairman. According to the feedback from the company, the new chairman is more pragmatic, and his business philosophy pays more attention to long-term business strategy control and short-term business quality assessment than the original management, and pays more attention to long-term brand and regional strategic layout. The company has always been good at group buying and consumer education, but it is slightly weak in brand marketing and strategic promotion. The appointment of the new chairman may help to make up for the shortcomings and promote the systematic reform of the company.
Investment suggestion: V series continues high growth, smooth four opening and upgrading, and the current price is stable and the inventory is benign. The medium and long-term K-series steady growth ensures the profit elasticity brought by the high growth of the basic sector and V-series, opens the growth space for expansion outside the province, and clearly divides the functions and powers through the brand business division system, so as to improve the promotion and marketing ability. In addition, the company's equity incentive has been promoted in an orderly manner, and the "14th five year plan" goal is expected to be completed with high quality. It is estimated that the company's earnings per share in 2022, 2023 and 2024 will be 2.11, 2.69 and 3.39 yuan respectively, maintain the Buy-A investment rating, and give a 6-month target price of 63 yuan, which is equivalent to the dynamic P / E ratio of 30x in 2022.
Risk tips: macroeconomic and policy risks, food safety problems, and the risk of development outside the province is less than expected
