\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 11 Zhejiang Entive Smart Kitchen Appliance Co.Ltd(300911) )
Event: Zhejiang Entive Smart Kitchen Appliance Co.Ltd(300911) released the first quarterly report of 2022. The company achieved revenue of 250 million yuan in 2022q1, yoy + 63.1%; Achieved a performance of 44.56 million yuan, yoy + 51.5%; Deduct 38.199 million yuan of non performance, yoy + 40.1%. We believe that the company optimized the organizational structure and increased marketing investment, and the Q1 revenue and performance growth exceeded the expectations of the capital market.
The company's sales market share increased significantly: Yitian Q1 revenue increased by 60%, much faster than the growth rate of the industry (according to Aowei data, Q1 integrated stove industry retail sales yoy + 19.5%), and the sales market share increased. We believe that the company's revenue exceeded expectations, mainly due to: 1) Yitian continued to adjust offline channels and optimize the quality of dealers. 2) In order to solve the problem of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) sales, the company distinguishes between online and offline product positioning and implements the same payment and commission mode. 3) Yitian has developed sinking, home decoration, Ka and other emerging channels and achieved certain sales results. Looking forward to the next few quarters, we expect that the quality and quantity of the company's channels will continue to improve, and the sales situation deserves the attention of the capital market.
Q1 net profit margin declined: Yitian 2022q1 net profit margin was 18.1%, year-on-year -1.4pct, mainly due to: 1) Yitian actively arranged sales channels and increased costs and prices, and Q1 gross profit margin was -0.7pct year-on-year. 2) Due to the increase of share based payment expenses and employee compensation, the Q1 management expense rate was + 3.4pct year-on-year. Yitian Q1 accrued equity incentive fee is about 3-4 million yuan. If we do not consider the impact of this expenditure, we calculate that the growth rate of the company's Q1 performance is 60% +, which is close to the growth rate of revenue.
Decline in Q1 operating cash flow: Yitian Q1's net operating cash flow was - 70 million yuan, compared with 50 million yuan in the same period of last year. The company's cash flow fell mainly due to: 1) as Q1 Yitian did not receive payment from e-commerce platform, accounts receivable increased by 80 million yuan year-on-year and 20 million yuan month on month at the end of March. 2) As Yitian increased its investment in advertising and marketing, Q1 paid other cash related to business activities, with a year-on-year increase of 30 million yuan. 3) Staff salaries and taxes increased, and the total cash and taxes paid to and for employees in Q1 increased by 40 million yuan year-on-year. On the whole, Q1 company's channel expansion and increased marketing investment have brought about a decline in cash flow.
Investment suggestion: Yitian integrated stove is a leading enterprise in the industry, with product advantages and wide channel coverage. We expect that the company's EPS from 2022 to 2023 will be 2.54/3.47 yuan respectively, and the six-month target price will be 76.20 yuan, corresponding to 30 times PE in 2022, maintaining the investment rating of buy-a.
Risk tip: the price of raw materials has risen sharply and the competition pattern has deteriorated
