Resumption 2020: the short-term impact recovery is limited, and the operating leverage amplifies the performance elasticity. The impact of this round of epidemic on the beer industry is similar to that of 2020q1. The closure and control of the epidemic has a great impact on the mobile sales of beer, and it is difficult to make up in full after the closure and control. From the perspective of listed companies: the replenishment brings high growth, and the gross profit margin and sales expense rate contribute to high performance elasticity. 1) Quantity: it is difficult to offset the loss by making up for it, the performance is better than the industry, and the national brand is better than the regional brand; 2) Price: the consumption toughness of high-end products is sufficient, the ton price of Q1 rises, the replenishment amount of Q2 consumption comes first, and the increase of volume leads the growth of revenue; 3) Performance: the increase of gross profit margin and the decrease of sales expense ratio boost profitability, the change of management expense ratio has little impact, the operating leverage enlarges the performance elasticity, and the high elasticity of Q2 begins to appear.
Outlook 2022: demand recovery is expected to repeat, and performance elasticity needs to focus on costs and selling expenses. 1) Volume: from January to February, the overall performance of beer enterprises exceeded expectations, but was flattened by the disturbance of the epidemic in March. The weather warmed up in May, and the mobile sales of beer entered the peak season. In the future, the impact of closure and control on beer sales still needs to be observed; 2) Price: the price increase measures have been implemented as scheduled, and the impact of the epidemic is expected to be small. The consumption toughness of high-end products may further contribute to the rise of ton price. From the perspective of gross profit margin, the current industry is in the period of cost rise rather than the period of cost decline in 2020q2, and it is expected that the increase rate of gross profit margin will not exceed that at that time; 3) Performance: if the cost side drops or the increase slows down further than expected, it is expected to contribute to the performance exceeding expectations. The sales expense is the core variable. In the sales expense of heavy beer and Yanjing, the proportion of publicity expense is higher. If the epidemic affects the investment of publicity expense and local promotion expense, they may bring greater performance flexibility.
Stock price resumption and deduction: marginal improvement, valuation first, and grasp the rising elasticity of beer. Resumption of trading: the change of sealing control margin drives the market sentiment, with valuation first, and the elasticity of stock price for covering the damage is large. Beer, as an optional consumption of popular goods, suffered serious damage to its movable sales during the closure of the epidemic, with a large decline in the index. However, it benefited from the slowdown of the closure margin, the improvement of sentiment led valuation, and the elasticity of stock price ranked first in all sub industries; Deduction: grasp the opportunity of marginal improvement and be optimistic about the elasticity of leading enterprises. In terms of starting time, it is suggested to focus on the marginal change of sealing and control measures, and the valuation should be first driven by emotion; In terms of the rise range, the fundamentals are the shield and the valuation is the spear. Grasp the high certainty of the rise in the peak season and the tolerance of overestimation.
Investment suggestions: grasp two main lines. 1) The main line of marginal improvement: it is the first beer leader Tsingtao Brewery Company Limited(600600) , whose influence on Shandong market is gradually weakened, and China Resources beer, which is widely distributed in China; 2) Main line of performance flexibility: it is suggested to pay attention to Chongqing Brewery Co.Ltd(600132) , the largest proportion of Wusu’s volume growth and publicity expenses, and Beijing Yanjing Brewery Co.Ltd(000729) , the bottom reversal of profitability driven by U8’s volume growth, cost reduction and efficiency increase.
Risk tip: the local repeated impact of the epidemic exceeded expectations, and the price rise of raw materials exceeded expectations. The cost model and relevant calculations have limitations.
