Zhou’s views and investment suggestions
The company is the exclusive franchisee of the Chinese mainland, Hongkong, China and Macao, China. The company has 15.7% of the brand, and the company has the global brand awareness and the “30 minutes will serve” efficient takeaway service. The taste and quality are excellent. In the year of 19 / 20 / 21, the company realized a revenue of RMB 840 / 11.0 / 1.61 billion, with a CAGR of 38.8%. In the past 21 years, takeout accounted for 73.2%, and its business resilience was strong under the epidemic situation. The 21-year revenue of Beijing and Shanghai accounted for 71.2% / – 7.5pct, accounting for a relatively high proportion, but showing a marginal downward trend, mainly due to the rapid growth momentum of the new growth market (the revenue CAGR reached 86.1%). The net profit of the company in 21 years was – 470 million yuan, and the increase in loss was mainly due to non recurring gains and losses such as the number of employees, unexpected increase in wages and changes in fair value. The company’s raw material expense rate, employee expense rate, rent and amortization expense rate in 21 years are 26.4% / – 1.7pct, 43.7% / + 1.2pct and 11.2% / – 1.2pct respectively. The raw material cost and rent cost are optimized under the scale effect.
In terms of the number of stores, based on Beijing and Shanghai, it gradually radiates the whole country, and the pace of opening stores is stable. At the end of the 21st century, the company had 468 Direct stores, with a net increase of 105, covering 10 cities in China. The proportion of stores in new growth cities continued to rise, reaching 42.9% / + 3.8pct in the past 21 years. From the average daily sales of stores, the daily sales in Beijing and Shanghai market are higher, mainly due to the high average daily order volume of stores and the bright growth of the new growth market. After the epidemic eased in 21 years, the average daily sales of stores recovered rapidly, with a year-on-year increase of + 7.3%. The average daily sales of Beijing Shanghai market and new growth market are 13000 yuan / + 5.4% and 8000 yuan / + 26.9% respectively. From the same store sales, the growth rate of the new growth market is better than that of the whole. The same store sales of the company in the past 21 years were + 18.7%, of which the same store sales in the new growth market was + 37.7%. In 2021, the operating profit at the store level was 150 million yuan / + 232.5%, and the profit margin reached 9.2% / + 5.2pct. The first revenue and expenditure balance period and cash investment payback period of the store were better than the market average.
Purpose of raised funds: focusing on store expansion, the company plans to open 120 / 180 stores in three existing central kitchens and cities that will open new central kitchens in 2022 / 2023. In addition, it will also be used for the reconstruction and renovation of existing stores and improving the utilization rate of central kitchens.
Investment suggestion: it is suggested to pay attention to the high efficiency of the main brand single store model, maintain a stable pace of store expansion and supplement the takeout business of jiumaojiu and Yum china-s. under the repeated epidemic situation, the demand for prefabricated dishes at the family end is released. It is suggested to pay attention to Suzhou Weizhixiang Food Co.Ltd(605089) . The hotel pays attention to the industrial rebound opportunities in the future recovery process, and it is suggested to pay attention to Shanghai Jin Jiang International Hotels Co.Ltd(600754) , Huazhu group-s. Data and announcement tracking
Market review: last week (2022 / 4 / 18 ~ 2022 / 4 / 22), CSI 300 and hang seng index fell 4.2%, 4.1% and social services (Shenwan) fell 4.5% respectively. In breakdown, catering A shares and Hong Kong stock indexes fell 7.4% and 2.3% respectively, hotel A shares and Hong Kong stock indexes fell 4.8% and 6.1% respectively.
Industry news: 1) xianmeilai will continue to promote the process of A-share listing and raise funds for marine food industrialization projects and frozen food sub packaging, refrigeration and logistics distribution projects. 2) bangbangxiang plans to list in Hong Kong and plans to set up seven new regional distribution centers outside Shanghai. 3) Honey snow ice city reduced the franchise fee of nearly 200 million yuan. 4) Wanda entered the new tea market.
Announcement of key companies: China Quanjude(Group) Co.Ltd(002186) released the annual performance report for 21 years, Xi’An Catering Co.Ltd(000721) , Xi’An Tourism Co.Ltd(000610) released the performance report for the first quarter of 22 years Suzhou Weizhixiang Food Co.Ltd(605089) some restricted shares are listed, accounting for 1.5% of the total share capital of the company; Yum China appoints KFC’s new chief customer officer and general manager.
Risk tips
The epidemic situation is repeated, the speed of opening stores is lower than expected, the development of new markets is lower than expected, and there is a risk of operating loss.
