The wholesale price of high-end liquor hovers at a low level, and the cost of mass products is still under pressure
March 2022 data showed that the wholesale price of high-end Baijiu continued to decline, the public goods prices rose signs of raw materials. Among them, flying Moutai 53 degrees (500ML) high-end liquor prices before last year’s Spring Festival before the highest price of 3300 yuan, after the small fall after the high volatility, last year’s national day price continued to reach 3880 yuan after continuing downward, recently cancelled by the box sales policy, the original box a further lower price, Baijiu after the Spring Festival prices continue to fall slightly, the current price of 2830 yuan. Beer and wine prices did not fluctuate significantly, but due to the impact of the epidemic, beer production fell significantly in March. In terms of cost environment, the price of pork is close to the relative bottom. After a slight rebound in the short term, the price of fresh milk is flat month on month, and the Shenzhen Agricultural Products Group Co.Ltd(000061) price fluctuates at a high level. However, due to geopolitical factors, the upward trend may be accelerated in the near future, and the price of packaging materials fluctuates slightly. At present, the cost environment is still facing certain pressure to be observed.
Investment advice
In the first quarter of this year, the food and beverage sector continued its downward trend as a whole. With the opening of the US dollar interest rate hike cycle and geopolitical factors, the liquidity disturbance caused by northward funds has suppressed the formation of the sector. In addition, the repeated epidemic and the slow recovery trend of consumption have led to fluctuations in consumption and investment sentiment, and the industry as a whole is still facing upward pressure on costs. In April, with the continuous adjustment of the sector, the valuation of some leading segments has been close to the low point in the past decade, and the investment value has appeared. The demand for quick-frozen food and prefabricated vegetables under the catalysis of the epidemic has increased, making the sector open the short-term repair market. At the current time point, we believe that each fine molecule industry has configuration value, and we suggest continuous attention. On the sector side, the more determined high-end Baijiu is still recommended. In terms of popular products, it is suggested to select the dairy industry with downward cost determination during the year and the beer sector with relatively better competition pattern and smoother pressure transmission. The beer sector will continue to benefit from the gradual recovery of consumption scenes after the epidemic, with the positive impact of price increase and high-end products, and high growth is expected. To sum up, we temporarily give the industry a “neutral” investment rating, and recommend Kweichow Moutai Co.Ltd(600519) ( Kweichow Moutai Co.Ltd(600519) ), Angel Yeast Co.Ltd(600298) ( Angel Yeast Co.Ltd(600298) ), Chongqing Fuling Zhacai Group Co.Ltd(002507) ( Chongqing Fuling Zhacai Group Co.Ltd(002507) ), Chongqing Brewery Co.Ltd(600132) ( Chongqing Brewery Co.Ltd(600132) ) and Inner Mongolia Yili Industrial Group Co.Ltd(600887) ( Inner Mongolia Yili Industrial Group Co.Ltd(600887) ).
Risk tips
Macroeconomic downside risks, major food safety risks, and epidemic prevention and control are less than expected.
