\u3000\u3000 Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) (603369)
Key investment points
Event: Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) it is announced that the company expects to achieve an operating revenue of 6.3-6.5 billion yuan in 2021, with a year-on-year increase of 23% – 27%; It is estimated that the net profit attributable to the shareholders of the listed company is 1.9 billion yuan and 2.1 billion yuan, with a year-on-year increase of 21% – 34%; It is estimated that the net profit attributable to the shareholders of the listed company after deducting non recurring profits and losses is RMB 1.9 billion-2.1 billion, with a year-on-year increase of 22% – 35%.
The performance objectives have been successfully completed and the structure has been continuously improved. According to the company’s announcement, it is expected to achieve revenue of 6.3-6.5 billion yuan in 2021, with a year-on-year increase of 23% – 27% and profit of 21% – 34%, which is basically in line with expectations. Guoyuan series drives the successful completion of the revenue target of RMB 5.9 billion in 2021. The company disclosed that the growth rate of special a + revenue is expected to exceed 35%, accounting for about 65% of the company’s revenue, which is significantly higher than 60% in 2020. The speed of structural upgrading is better than our previous expectation. We expect that the proportion of special a + revenue of the company is expected to reach 70% in 2023.
The dealer conference released a positive signal, and the V99 alliance built a 10-year 10 billion project of V series. The development conference of “focusing on new leaps of high-quality cohesion” held on Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) December 29 released a positive signal. 1) Fruitful achievements in 2021: the 14th five year plan has made a good start, and Q4 is expected to continue to maintain a good development trend in 2021. The development of weak markets and markets outside the province was smooth. In the first three quarters, the market in the province increased by 26.3%, and the province achieved global growth, especially in weak markets such as Jiangsu Lianyungang Port Co.Ltd(601008) , Nantong and Suqian; The market outside the province increased by 36.7%, and the market of “2 + 5” key provincial plates increased by more than 35%. In the future, we will strive to increase the proportion of revenue outside the province to more than 20% at the end of the 14th five year plan; In terms of products, in the first three quarters, the proportion of super class a Guoyuan V-series increased by 120% year-on-year, and the proportion of Guoyuan brands increased to 10.7%; Special a + increased by 31.3%; The cultivation of secondary high-end new products D20 / 30 has achieved remarkable results; 2) Outlook for 2022: the new year’s marketing work will be carried out around “13445”, that is, one main line, following the three modernizations strategy, four campaigns (improving V9 potential energy, enabling open systems, improving control and profit sharing, strengthening Jiangsu King’S Luck Brewery Joint-Stock Co.Ltd(603369) brand activation, market breakthrough outside the province) and five guarantees; 3) Form V99 alliance from “selling more wine” to “selling good wine”: V99 alliance is mainly composed of Guoyuan V-series core dealers. The alliance includes 38 distribution units in the first batch, and the upper limit is expected to be 99, so that members can deeply participate in the marketing scheme and obtain more differentiated support, so as to better unite manufacturers to implement the V-series “ten year ten billion project”.
The new Sikai channel performed well, boosting the rapid growth of 2022 performance. After the launch of the new Sikai, it performed well. 21q3 still maintained a benign growth under the influence of the epidemic, verified the rising period of brand potential energy, narrowed the price difference of 21q4 channel slightly, and continued to maintain the strength of dynamic sales; V series continues to be high-end, and the elegant Maotai flavor of V9 is more suitable for Jiangsu taste. In the region, it focuses on the main markets such as Nanjing, Huai\’an and Yancheng. V3 card upgrades the price band and has a large channel layout space. According to the company’s announcement, the share repurchase to be used for equity incentive has been completed by the end of November 2021, taking a solid step in promoting equity incentive, which is expected to drive the implementation of incentive. In the medium and long term, we believe that the company is still in the period of rising brand potential, and its share in the sub high-end price belt in the province is becoming more and more stable. We are optimistic that the company will achieve rapid growth through intensive cultivation in the province and steady expansion outside the province under the guidance of the revenue target of 10 billion in the “14th five year plan”.
Profit forecast and investment suggestions: maintain the “buy” rating. According to the performance pre increase scope and operating data disclosed by the company this time, the speed of product structure upgrading is slightly higher than expected. We slightly revised the profit forecast. It is estimated that the total operating revenue of the company from 2021 to 2023 will be RMB 6.401/79.19/9.512 billion respectively, with a year-on-year increase of 24.98% / 23.71% / 20.12%; The net profit was RMB 2.020/25.42/3.084 billion respectively, with a year-on-year increase of 28.90% / 25.84% / 21.36%, the corresponding EPS was RMB 1.61/2.03/2.46 (the previous time was RMB 1.57/1.94/2.36), and the corresponding PE was 32, 25 and 21 times respectively. Key recommendations.
Risk warning: the global epidemic continues to spread; Consumption upgrading is less than expected; Food safety issues.
