\u3000\u3 China Vanke Co.Ltd(000002) 508 Hangzhou Robam Appliances Co.Ltd(002508) )
Event:
On April 19, 2022, Hangzhou Robam Appliances Co.Ltd(002508) released the annual report of 2021 and the first quarterly report of 2022. In 2021, the company realized an operating revenue of 10.148 billion yuan (+24.84%); The net profit attributable to the parent company was 1.332 billion yuan (- 19.81%). In 2021q4, the company achieved a revenue of 3.077 billion yuan (+ 22.96%) and a net profit attributable to the parent company of -11 million yuan (- 102.00%). In 2022q1, the company realized a revenue of 2.086 billion yuan (+ 9.32%), and a net profit attributable to the parent company of 368 million yuan (+ 2.47%).
Key investment points:
The growth rate of dishwashers in emerging categories is bright, and the revenue in 2021q4 is growing rapidly. 1) Quarter by quarter: the company achieved a revenue of 3.077 billion yuan (+ 22.96%) in 2021q4 in a single quarter, mainly due to: A. dividends brought by the improvement of industry concentration; b. The company’s category and channel revenue performance are excellent. In 2022q1, the company achieved a revenue of 2.086 billion yuan (+ 9.32%) in a single quarter, achieving steady growth. 2) By category: in 2021, the revenue of the company’s traditional cigarette stoves increased rapidly, with a year-on-year increase of + 18.73% and + 27.25% respectively; The revenue growth of emerging categories such as all-in-one machines and dishwashers was bright, with a year-on-year increase of + 71.26% and + 101.32% respectively. Taking dishwashers as an example, the double rise in volume and price of the boss brand has driven revenue growth. According to orvey data, the online sales volume of the boss dishwasher in 2021 reached 46500 (+ 95.05%), with an average price of 5215 yuan (+ 13.09%). 3) By channel: in 2021, the revenue of the company’s consignment, distribution, direct operation and engineering modes were + 19.23%, + 9.85%, + 39.13% and + 6.95% respectively year-on-year. Among them, the direct operation mode accounted for a large proportion of revenue (45.80%) and increased rapidly, which helped to improve the total revenue.
The profitability of 2021q4 and 2022q1 is under pressure. 1) Gross profit margin: the gross profit margins of 2021q4 and 2022q1 companies were 43.73% (-10.44pct) and 52.56% (-4.78pct) respectively, with a large decline mainly due to: A. The Rise of raw material prices; b. The change of accounting standards will adjust the transportation expenses from sales expenses to operating costs. 2) Net interest rate: the net interest rates of 2021q4 and 2022q1 companies are – 0.3% (- 22.02pct) and 17.45% (- 1.45pct) respectively. The abnormal net interest rate of 2021q4 is mainly due to the financial difficulties of some fine decoration business customers. Based on the principle of prudence, the company accrued 778 million yuan of bad debt reserves in 2021.
Categories and channels are mutually empowered to continuously develop diversified channels. 1) Retail channel: take the “boss’s four piece set” as the starting point to lead the industry to a systematic and high-end development; At the same time, carry out digital marketing reform to improve channel efficiency. 2) Innovative channels: through cooperation with the whole house customization and home decoration head enterprises, seize the front-end flow entrance, tap the market stock resources and improve the matching rate of the second and third categories. 3) E-commerce channels: new and old media platforms drain each other to explore user value through content-based marketing; Accelerate the iterative upgrading of products and realize the sharing of product advantages and channels. 4) Project Channel: optimize the structure of customers and products, promote the systematic solution of refined decoration residential kitchen electric products, and further popularize the central range hood. 5) Overseas channels: continuously optimize the global layout and promote the process of brand internationalization.
Products continue to promote new iterations, and manufacturing upgrading contributes to long-term development. 1) Product side: in March 2022, the company released a new generation of high-performance integrated stoves, ultra-thin range hoods, multifunctional cooking machines, Sichuan series gas water heaters, dishwashers that can wash pots and other new products. 2) Production side: the company’s Maoshan intelligent manufacturing science and technology innovation park project has been put into use one after another, providing assistance for product iteration and upgrading of manufacturing intelligence capability, and consolidating the foundation of the company’s long-term development.
Issue stock option incentive in 2022 to help the company grow its business scale. The stock option incentive plan will last for 3 years. It is proposed to grant 4.81 million stock options to 285 middle-level managers and technical backbones of the company. The assessment target is based on the company’s revenue in 2021, and the compound growth rate of operating revenue from 2022 to 2024 will not be less than 15%, so as to mobilize the enthusiasm of employees and provide assistance for the development of the company.
The recovery of the real estate industry, the continuous improvement of superimposed products and channels, and the company’s performance is expected to continue to improve. It will be covered for the first time and given a “buy” rating. With the loosening of real estate policy, it continues to release positive signals to the market, and the demand for kitchen electricity may be gradually boosted in the future. Superimposed on the diversified channel layout of the company and the gradual improvement of the product matrix of new and old categories, it is expected to jointly help the rapid growth of the company’s performance, cover it for the first time and give a “buy” rating. We predict that from 2022 to 2024, the net profit attributable to the parent company will be RMB 2.154/24.652780 billion, the corresponding EPS will be RMB 2.27/2.60/2.93, and the current share price will be RMB 13.41/11.71/10.39.
Risk tips: covid-19 epidemic situation is repeated, market competition intensifies, raw material prices rise, real estate industry fluctuates, and new product research and development is less than expected.
