\u3000\u3 Shengda Resources Co.Ltd(000603) 605 Proya Cosmetics Co.Ltd(603605) )
The net profit attributable to the parent company increased by 44.2% in 2022q1, and the performance was close to the upper limit of the notice: the company released the annual report of 2021 and the quarterly report of 2022q1. In 2021, the company achieved a revenue of 4.633 billion yuan (year-on-year + 23.5%), a net profit attributable to the parent company of 576 million yuan (year-on-year + 21.0%), and a net profit not attributable to the parent company of 568 million yuan (year-on-year + 20.9%). 22q1 achieved a revenue of 1.254 billion yuan (year-on-year +38.5%), a net profit attributable to the parent company of 158million yuan (year-on-year +44.2%), and a net profit not attributable to the parent company of 147million yuan (year-on-year +36.2%). Quarterly, the revenue from 2021q1 to 2022q1 increased by 49% / 30% / 21% / 11% / 39% and the net profit attributable to the parent company increased by 41% / 15% / 30% / 11% / 44% respectively. The company received 14 million government subsidies in 2022q1.
The gross profit margin increased year-on-year, and the cash flow performance was excellent: in 2021, the gross profit margin / net profit margin of the company were 66.5% / 12.0% respectively, the gross profit margin increased by 2.9pct year-on-year, and the net profit margin was basically the same. The gross profit margin / net profit margin of 2022q1 company was 67.6% / 13.5% respectively, with an increase of 3.2pct/1.7pct respectively. The gross profit margin continued to increase, mainly due to the increase in the proportion of online channels, large single products and online self broadcasting. In 2021 / 2022q1, the sales expense rate of the company increased by + 3.1pct / + 0.7pct respectively, mainly due to the increased investment in image publicity and promotion such as new brand incubation. In 2021, the company’s operating cash flow was 830 million yuan, an increase of 150.2% at the same time. The excellent cash flow performance is mainly due to the increase of sales receipts and the improvement of accounts receivable.
Online direct marketing and multi platform development accounted for about 85% in 2021: in 2021, the company achieved online / offline revenue of RMB 3.92/700 billion respectively, with a year-on-year change of + 49.5% / – 38.0% respectively. Among them, online direct sales / online distribution / daily chemical / other channels were RMB 28.0/11.2/5.0/190 million respectively, with a year-on-year change of + 76.2% / 8.6% / – 40.5% / – 30.5% respectively. Online tmall flagship store continues to consolidate the strategy of large single products and improve the proportion of self broadcasting; Tiktok and Kwai are increasing faster. Offline 2022 will focus on Chongqing Department Store Co.Ltd(600729) , Yintai department store, Tianhong Department store and other systems.
Proya Cosmetics Co.Ltd(603605) , Caitang’s revenue continued to grow rapidly, and the strategy of large single products was promoted smoothly: in 2021, the revenue of Proya Cosmetics Co.Ltd(603605) / Caitang brand was 3.83/250 billion yuan, an increase of + 28.3% / + 103.5% respectively, and the revenue of other brands and cross-border agents was 410 / 140 million yuan, a decrease of – 6% / – 34% respectively. In 2021, the revenue of Proya Cosmetics Co.Ltd(603605) / Caitang accounted for 82.9% / 5.3% respectively. The company’s large single product strategy was implemented smoothly. In 2021, the company continued to expand the matrix of large single products. In 2021, the company’s large products included Ruby series, double resistance series, source repair essence, bowling blue bottle, feather sense sunscreen, and continuous upgrading and upgrading of existing large single product.
Profit forecast and investment rating: the company is a Volkswagen cosmetics group with flexible organization and leading efficiency in China, with leading multi platform layout and smooth promotion of large single products. Due to the good performance of Q1, we raised the forecast of net profit attributable to parent company from 2022 to 2023 to 720 / 898 million yuan, and the net profit attributable to parent company in 2024 is expected to be 1.13 billion yuan, with a year-on-year increase of 25.01% / 24.72% / 25.76% respectively from 2022 to 2024, corresponding to 51 / 41 / 32 times of dynamic PE, Maintain the “overweight” rating.
Risk tip: market competition intensifies, and the expansion of new brands is less than expected
