\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 73 Ligao Foods Co.Ltd(300973) )
Event: the company released the annual report of 2021 and the first quarterly report of 2022. In the 21st year, the company achieved a revenue of 2.817 billion yuan, a year-on-year increase of 55.7%; The net profit attributable to the parent company was 283 million yuan, with a year-on-year increase of 22.0%, of which 21q4 realized an income of 856 million yuan, with a year-on-year increase of 40.4%; The net profit attributable to the parent company was 86 million yuan, a year-on-year increase of 16.6%. 22q1 company achieved a revenue of 630 million yuan, a year-on-year increase of 8.8%; The net profit attributable to the parent company was 40 million yuan, a year-on-year decrease of 45.3%.
Comments:
21q4 revenue performance exceeded expectations, and 22q1 revenue growth was lower than expected. 21q4’s revenue performance was good, mainly due to the increase of production capacity of factories in Henan and the preparation of goods for the Spring Festival. 22q1’s revenue growth was lower than expected due to the impact of covid-19 epidemic and the decline of Ka channel demand. In terms of business, the revenue of 22q1 frozen baked goods / baking raw materials business was 372 / 257 million yuan respectively, with an increase of 11.14% / 5.57% respectively. The frozen baked goods business was affected by the epidemic, and the revenue growth rate was relatively weak.
22q1 rising raw material costs dragged down the gross profit margin. 21q4’s gross profit margin was 34.5%, up 0.8 percentage points month on month, mainly due to the increase of production capacity and the embodiment of scale effect. 22q1’s gross profit margin was 33.1%, a year-on-year decrease of 3.4 percentage points, mainly due to the rise in the price of raw materials such as oil and lower capacity utilization. 22q1 sales / management / R & D expense rates were 13.0% / 8.9% / 3.5% respectively, with a year-on-year increase of 0.1 / 4.5 / 1.2 percentage points respectively. The rate of administrative expenses increased significantly, mainly due to the increase of share based payment expenses. The increase in R & D expenses is mainly due to the company’s increased R & D investment. 22q1’s net interest rate attributable to the parent company was 6.4%, a year-on-year decrease of 6.3 percentage points. Excluding share based payment expenses, the non net profit attributable to the parent company of 22q1 was 54.74 million yuan, a year-on-year decrease of 23.97%.
Product price increase and internal cost reduction and efficiency increase alleviate cost pressure. In response to the pressure of price increase on the cost side, 22q1 company has raised the price of its Portuguese tarts, cream and other products. At the same time, the company purchases raw materials through China’s alternative import and uses new raw materials to achieve the purpose of reducing costs and increasing efficiency. If the epidemic is controlled, we expect the scale effect will be more reflected with the growth of the company’s revenue.
Profit forecast and investment rating: affected by the epidemic in the short term, the company’s growth is weak, but the epidemic does not change the company’s long-term competitiveness. LEGO has a first mover advantage in process and technology. With the embodiment of economies of scale, the company will obtain a lower cost structure. The penetration rate of frozen semi-finished products is low, and the company’s products and channels are driven by both, so there is still large room for growth. We expect that the company’s EPS in 22-24 years will be 1.67/2.27/3.37 yuan respectively, and the corresponding PE will be 50.79/37.33/25.12 times respectively, maintaining the “buy” rating.
Stock price catalyst: the price of raw materials decreased; Performance exceeds expectations, etc.
Risk factors: the price rise of raw materials is higher than expected; The promotion of new products is less than expected; The epidemic situation is repeated.
