\u3000\u3 Shengda Resources Co.Ltd(000603) 579 Shanghai Rongtai Health Technology Corporation Limited(603579) )
Core view
Event: the company released its annual report for 2021, and achieved an operating revenue of 2.613 billion yuan in 2021, a year-on-year increase of + 29.30%; The net profit attributable to the parent company was 236 million yuan, a year-on-year increase of + 22.45%; Deducting the net profit not attributable to the parent company of 135 million yuan, a year-on-year increase of - 12.92%, it is proposed to distribute a cash dividend of 7 yuan (including tax) for every 10 shares.
Comments:
Revenue grew steadily and the overseas market performed well. The operating revenue of the company increased steadily. By category, the annual revenue of massage chairs / massage small appliances in the main business was 2.380134 billion yuan, with a year-on-year increase of + 35.24% / - 9.84% respectively. The brand of momoda developed rapidly, with an annual revenue of 203 million yuan, a year-on-year increase of + 106.7%. The annual sales of massage chairs reached 45000 units, and the sales of single products of sx322 eye protector exceeded 60000 units. In terms of sub regions, the company's China / overseas ODM Sales revenue in 2021 was 1.194/1.392 billion yuan respectively, with a year-on-year increase of + 26.58% / + 31.94% respectively, accounting for 45.69% / 53.27% of the total revenue respectively, of which the revenue in South Korea accounted for more than half, with a year-on-year increase of + 9.25%, and the sales volume and sales volume in the United States doubled.
Changes in product structure put pressure on the company's gross profit margin in the short term. In 2021, the company's gross profit margin fell from - 1.9pct to 26.84% year-on-year. First, it was affected by the price rise of raw materials, second, it was affected by the adjustment of accounting standards, and third, the sales volume of massage small appliances with low gross profit increased, which reduced the overall gross profit margin to a certain extent (the gross profit margin of massage chair / massage small appliances in 2021 was 27.79% / 24.07% respectively, and the annual sales volume was + 39.52% / + 50.69% respectively). The annual sales / management / R & D expense ratio was + 0.4pct / - 0.2pct / - 0.4pct to 9.77% / 2.82% / 4.56% respectively. Superimposed with the increase of the company's non recurring income, the comprehensive impact on the annual net profit margin was - 0.2pct to 8.73% year-on-year.
Channel sinking and brand marketing are carried out in both directions, and the online influence continues to expand. By the end of 2021, the coverage of the company's offline stores in cities across the country has reached 68%, of which the first and second tier cities have full coverage, and the coverage of the top 100 counties has reached 60%. The company insists on the sinking of channels, and the blank market is expected to bring new increment. The company tiktok and other emerging business providers, actively broadcast live channels, through joint promotion with Disney IP, to promote product premium, and help the new brand spokesperson Wang Yibo, promote brand image younger, take measures to achieve a new level of sales revenue.
Investment suggestion: the leading position of massage chair industry is stable, the brand strength is continuously improved, and the "buy" rating is maintained. Considering the impact of covid-19 epidemic on the domestic market, we fine tune the company's profit forecast. It is estimated that the company's net profit attributable to the parent company from 2022 to 2024 will be RMB 295 / 350 / 400 million respectively (the original forecast was RMB 305 / 363 million in 2022 / 2023), corresponding to 12 / 10 / 9 times of the current market value PE respectively, maintaining the "buy" rating.
Risk tips: excessive exchange rate fluctuations, repeated outbreaks in China, fluctuations in raw material prices, etc.
