\u3000\u3 Shengda Resources Co.Ltd(000603) 605 Proya Cosmetics Co.Ltd(603605) )
Event: the company announced the performance of 2021 and 22q1. In 2021, the revenue was 4.633 billion yuan, a year-on-year increase of +23.47%, and the net profit attributable to the parent company was 576million yuan, a year-on-year increase of +21.03%; Deduct the net profit not attributable to the parent company of 568 million yuan, a year-on-year increase of + 20.89%. 22q1 company achieved a revenue of 1.254 billion yuan, a year-on-year increase of + 38.53%, and a net profit attributable to the parent company of 158 million yuan, a year-on-year increase of + 44.16%, deducting a net profit not attributable to the parent company of 147 million yuan, a year-on-year increase of + 36.21%.
Upgrade the main brand, build a large single product echelon, consolidate the core competitiveness, and enrich the brand matrix for makeup washing and care. The company adheres to differentiated multi brand development and actively improves the brand matrix. 1) Proya Cosmetics Co.Ltd(603605) & Caitang: in 2021, Proya Cosmetics Co.Ltd(603605) and Caitang contributed nearly 90% of the total revenue, of which Proya Cosmetics Co.Ltd(603605) sales were 3.829 billion yuan, a year-on-year increase of + 28.25%, and the revenue of Caitang, a cosmetics brand, was 246 million yuan, a year-on-year increase of + 103.48%, accounting for 82.88% / 5.33% of the total revenue respectively Proya Cosmetics Co.Ltd(603605) upgraded and expanded category of existing large single products, and launched a series of new products, such as source repair essence, bowling blue bottle, etc., to further deepen the strategy of large single product, create a large single product ladder, enhance brand technology sense and youthful feeling, and increase customer unit price and repeat purchase rate continuously. Make-up brands are doubled, and large single products, including executive makeup, and strengthening products such as makeup, concealer and makeup remover, are being built. 2) Off & relax: the company launched off & relax, the main brand of hot spring water scalp care, in June 21, covering new areas of washing and care, focusing on the concept of scalp care. Yang Jianzhong, the top R & D Engineer of brand cooperation, once served as the chief R & D scientist of P & G. all product lines have completed R & D and production in Japan. Online refined operation and sales increased rapidly, and offline adjustment and upgrading continued to be promoted. 1) Online: the company continues to cultivate
Online channels, increase online fine management, and strengthen the tiktok platform brand self seeding. In 21 years, the online revenue was 3.924 billion yuan, accounting for 84.94% of the total revenue, with a year-on-year increase of + 49.54%, of which the direct revenue was + 79.63%. 22Q1 online channel contributed the main revenue increment, Tmall tiktok 38 promotional activities flagship store GMV grew 200%+, the shaking platform opened second official shops, further enhance the platform GMV, so far, there are 8.2w fans, total sales volume 98 thousand. 2) Offline: Daily Chemical channels continue to promote network adjustment, focusing on building Yintai, Chongqing Department Store Co.Ltd(600729) and other high-quality department store systems; The epidemic had a certain impact on offline sales, with offline revenue of 696 million yuan in 21 years, a year-on-year increase of – 38.03%. In addition, the off-line channel destocking reduced the accounts receivable in 21 years by 146 million yuan compared with the beginning, and the operating cash flow was + 150.24%.
Create a new brand image, increase R & D and co creation: the company’s gross profit margin in 2021 was 66.46%, with a year-on-year increase of + 2.91pct. The increase of the company’s profit is mainly due to the increase of online gross profit margin of 68.27%, a year-on-year increase of 1.92pct, and offline gross profit margin of 56.93%, a year-on-year decrease of 0.33pct. The company strengthens the fine operation online, pays attention to the accurate marketing delivery, and improves the profitability of the channel. The proportion of online channels with high profitability increased, and the company continued to launch new large single products, driving the steady improvement of the company’s overall profitability. The gross profit margin of 22q1 remained high, reaching 67.57%. In 2021, the company’s sales, R & D and management rates were 42.98%, 1.65% and 5.12% respectively, which were + 3.08pct, -0.27pct and -0.32pct respectively compared with last year. The company pays attention to the investment in the construction of new brands, resulting in the image publicity and promotion fee in the sales expense + 3.44%; The decrease in R & D expense rate is mainly due to the company’s increasing R & D Co creation and cooperating with Spain lipotrues in the form of equity investment 50. Shenzhen Zhongke Xinyang and other front-end research institutions and excellent raw material suppliers.
Profit forecast and investment suggestions: the company continues to deepen the refined operation and management mode with “R & D, products, content and operation” as the main line; Strengthen independent R & D capability, integrate global resources and consolidate core competitiveness. On the basis of keen insight into consumer needs, we will constantly upgrade and expand the large item matrix, improve brand vitality and continuously enrich the multi brand matrix. We expect the net profit of the company in 22-24 years to be 7.5/9.6/1.18 billion yuan respectively, corresponding to 48 / 38 / 31 times of PE, maintaining the “buy” rating.
Risk tip: the promotion of new products is not as expected; Intensified market competition; Repeated epidemics and pressure on channel sales; Logistics recovery is less than expected; The downward pressure on the economy has increased.
