\u3000\u3 Shengda Resources Co.Ltd(000603) 833 Oppein Home Group Inc(603833) )
Events
The company issued the annual report of 2021. In 2021, the company achieved a revenue of 20.442 billion yuan, a year-on-year increase of 38.68%; The net profit attributable to the parent company was 2.666 billion yuan, a year-on-year increase of 29.23%. The company plans to distribute a cash dividend of 17.5 yuan (including tax) for every 10 shares.
Key investment points
In the 21st year, the revenue scale stood at a new starting point of 20 billion yuan, and the performance declined due to the superposition of 21q4 credit impairment losses and the rise of raw material prices. On the revenue side, in 2021, the company achieved a revenue of 20.442 billion yuan, a year-on-year increase of 38.68%. Quarterly, 21q1 / Q2 / Q3 / Q4 achieved a revenue of 33.0/49.0/62.0/6.04 billion yuan respectively, a year-on-year increase of 130.7% / 38.6% / 30.1% / 20.6%. In the fourth quarter, the company continued to grow steadily despite the epidemic situation and the high base in the same period (20q4 revenue increased by 25.3%). On the net profit side, in 2021, the company realized a net profit attributable to the parent company of 2.666 billion yuan, a year-on-year increase of 29.23%, and the company’s performance was close to the lower limit of the previous performance forecast. Quarter by quarter, 21q1 / Q2 / Q3 / Q4 realized a net profit attributable to the parent company of RMB 2.4/7.7/11.0/550 million respectively, with a year-on-year increase of 340.0% / 30.1% / 14.6% / – 9.8%. The decline of 21q4 performance was mainly affected by the decline of gross profit margin and the increase of credit impairment loss.
The scale of wardrobe and supporting products exceeded 10 billion, and the category of wooden door bathroom increased rapidly. In terms of products, in 2021, 1) the company’s wardrobe and supporting furniture products achieved a revenue of 10.17 billion yuan / + 49.5%, of which the volume was + 50.5%, the price was + 17.1%, and the revenue accounted for 49.8%. Under the comparable caliber (in 2021, the company’s wardrobe business added supporting furniture products), the proportion increased by 3.6pct, making it the largest revenue of the company; 2) The revenue of kitchen cabinets reached 7.53 billion yuan / + 24.2% (21q4 increased by 10.5% year-on-year), of which the volume was + 25.1%, the price was – 0.7%, and the proportion of revenue decreased by 4.3pct to 36.8%. In 2021, the company opened more than 1300 new kitchen cabinets and newly installed stores. At the same time, the company promoted the development of kitchen cabinet packaging business, and there were more than 3000 cooperative decoration enterprises of retail dealers; 3) Through brand building, channel deepening and model innovation, the wooden door business achieved an annual revenue of 1.24 billion yuan / + 60.4% (21q4 increased by 39.8% year-on-year), of which the volume was + 60.6%, the price was – 0.2%, and the revenue accounted for 6.0%; 4) The sanitary ware revenue is 990 million yuan / + 33.7% (21q4 increased by 24.5% year-on-year), of which the volume is + 34.9%, the price is – 0.9%, and the revenue accounts for 4.8%. The high growth of the company’s sanitary ware business is expected to mainly contribute to the opening of stores. By the end of 21, there were 805 European style sanitary ware stores, a net increase of 217 compared with the beginning of the period, with a growth rate of 36.9%; 5) Other main business income is 220 million yuan / + 64.4%, accounting for 1.1%. In 2021, the gross profit margins of wardrobe and supporting furniture products, kitchen cabinets, bathroom and wooden doors were 32.2%, 34.4%, 25.4% and 13.8% respectively, with a year-on-year increase of – 4.2, – 1.8, – 1.3 and – 0.1pct.
Retail stores have improved significantly, the bulk operation is stable, and the whole decoration is broken and new. By channel, in 2021, the company’s retail and engineering business achieved rapid growth, and the revenue structure remained basically stable. 1) In terms of retail business, in 2021, the dealer channel achieved a revenue of 15.68 billion yuan, a year-on-year increase of 40.2% (21q4, a year-on-year increase of 21.2%), accounting for 77% of the revenue. Compared with the beginning of the period, the dealer stores increased by 363 to 7475 (including 77, 52, – 44, 217, 61 to 2201, 2459, 1021, 805 and 989 respectively). We estimate that the average single store pick-up volume of the company’s distribution channels increased by 30% year-on-year; The direct sales channel achieved a revenue of 590 million yuan, a year-on-year increase of 47.3% (21q4, a year-on-year increase of 33.8%), accounting for 2.9% of the revenue. The net increase of 5 to 47 Direct stores compared with the beginning of the period. It is estimated that the efficiency of the company’s Direct stores exceeds 12 million / year, a year-on-year increase of 30% +. The operation efficiency of the company’s retail business stores has been greatly improved. 2) In terms of engineering business, the bulk channel business of the company operated steadily in 2021, with annual revenue of RMB 3.67 billion, a year-on-year increase of 36.9% (21q4, a year-on-year increase of 21.9%) and revenue accounting for 18.0%. In addition, other channels achieved a revenue of 200 million yuan, a year-on-year decrease of 15.4%, and the revenue accounted for 1.0%. 3) In terms of the expansion of packaged channels, in 2021, the company launched the “starhomes Star home” packaged home brand, realizing the integration of dual brands into the whole customized track. As of November 5, 21, the company’s packaged order receiving performance exceeded 2 billion yuan, with a year-on-year increase of more than 90% in 2021, and the packaged business is expected to account for more than 10% of the company’s revenue. In 2021, the gross profit margins of dealer channels, direct sales channels, bulk channels and other channels were 30.3%, 64.1%, 30.8% and 29.0% respectively, with a year-on-year increase of – 3.8, – 2.2, – 1.9 and – 5.7pct.
Profitability is under short-term pressure, and expense control continues to be strengthened. In terms of profitability, in 2021, due to the impact of rising raw material prices, the company’s gross profit margin decreased by 3.4pct to 31.6% year-on-year, and 21q4 gross profit margin decreased by 4.0pct to 29.0% year-on-year. In terms of expense rate, the company’s expense rate during the period of 2021 decreased by 2.6pct to 16.2%, of which the sales / management / R & D / financial expense rate was 6.8% / 5.5% / 4.4% / – 0.6%, with a year-on-year increase of – 1.0 / – 1.0 / – 0.3 / – 0.3pct. Under the comprehensive impact, the company’s net sales interest rate in 2021 was 13.0%, a year-on-year decrease of 1.0pct, and the net interest rate of 21q4 decreased by 3.1pct to 9.1%. In terms of inventory, as of the end of the year, the company’s inventory was 1.46 billion yuan / + 80.93%, mainly due to the sufficient preparation of raw materials and the increase of finished products. The inventory turnover days were 29 days, a year-on-year decrease of 2 days. In terms of cash flow, the net cash flow from operating activities of the company in 2021 was 4.046 billion yuan, a year-on-year increase of 4.0%.
Investment suggestion: in 2021, the company will continue to deepen the large home model, significantly improve the efficiency of retail stores, steadily operate bulk businesses, make rapid progress in the whole packaging business, and achieve rapid growth in the revenue of all categories during the year. Looking forward to 2022, the company will continue to strengthen the improvement and expansion of operation capacity, strengthen the integration of various categories of European School, and deepen the information enabling business. We predict that the company’s earnings per share from 2022 to 2024 will be 5.16 yuan, 6.29 yuan and 7.50 yuan respectively, corresponding to 24 times and 19 times of the company’s PE in 22 and 23 years respectively. For the first time, we give “buy-b” suggestions.
Risk warning: the impact of the epidemic exceeded expectations, and the completion and sales data of commercial housing were less than expected; Industry competition intensifies; The shop opening progress is not as expected; Risk of sharp fluctuations in raw material prices.
