\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 519 Kweichow Moutai Co.Ltd(600519) )
Event: Kweichow Moutai Co.Ltd(600519) released the first quarterly report of 2022. In the first quarter of 2022, the company achieved a total operating revenue of 33.19 billion yuan, a year-on-year increase of + 18.3%; The net profit attributable to the parent company was 17.24 billion yuan, a year-on-year increase of + 23.6%, and the performance growth rate was slightly higher than the previous forecast guidelines. In addition, the company’s contractual liabilities at the end of the first quarter of 2022 were 8.32 billion yuan, an increase of 2.98 billion yuan year-on-year.
The speed of Maotai liquor increased significantly, and the series of liquor continued to increase. In terms of Maotai liquor, in the first quarter of 2022, the revenue reached 28.86 billion yuan, a year-on-year increase of + 17.4%, with a significant month on month increase. The revenue growth rate in a single quarter reached a new high in recent two years. It is expected to be the non-standard year-on-year increase and the volume of direct channels. In the first quarter of 2021, due to the impact of non-standard price adjustment and other factors, the delivery rhythm was slightly delayed. The company increased the launch of zodiac and other products around the Spring Festival this year. In terms of wine series, the revenue in the first quarter of 2022 was 3.43 billion yuan, a year-on-year increase of + 29.7%, continuing a high growth. It is expected to be the launch of new products and the increase of the overall ton price.
The proportion of direct selling reached a new high, and I Maotai strengthened the C-end channel. In terms of sub channels, in the first quarter of 2022, the company’s direct channel revenue increased by 127.9% year-on-year, and the proportion increased to 33.7%, reaching a new record; The distribution channel revenue decreased slightly by 4.7% year-on-year, reflecting the results of the company’s channel optimization. During the reporting period, the company launched I Maotai as a new e-commerce platform, which is also an important measure of the company’s C-end channel reform, which is of positive significance for the volume and price stability of subsequent Maotai series products and the cultivation of consumers. In addition, as of 2022q1, the number of distributors of the company in China was 2086, with little change month on month, and the distribution system tended to be stable.
The implementation of all-round reform is accelerated, and the acceleration of high quality can be expected. Since the new chairman took office in August 2021, the products and channels have made frequent moves. On the product side, clarify the whole product line of Maotai, focus on “fist” products, and launch Maotai 1935 and rare Maotai; On the channel side, we will continue to implement the marketization of Maotai’s price, take multiple measures to stabilize the rating, reduce the price difference of boxes / bulk bottles, launch new e-commerce channels recently, and supplement the short board of Maotai’s C-end channel, so that we can see a brand-new Maotai and an upward Maotai. In 2022, the target growth rate of the company’s revenue is about 15%, and the first quarter has made a successful start. With the effect of the company’s all-round reform, the new Maotai is worth looking forward to.
Profit forecast and investment suggestions: we are optimistic about the stability of the company’s growth and the upward space of ton price under the endorsement of strong brand power. We look forward to the improvement of the subsequent company’s operation level and the improvement of the company’s development momentum and governance. We slightly revised the original profit forecast. It is estimated that the company’s net profit attributable to the parent company from 2022 to 2024 will be 63.7/759/89.3 billion yuan (the original forecast was 61.9/720/83.4 billion yuan), a year-on-year increase of + 21% / 19% / 18%. The current share price corresponds to PE of 34x / 28x / 24x from 2022 to 2024, maintaining the “buy” rating.
Risk tip: the macroeconomic downturn has led to lower demand for high-end wine than expected, and the effect of channel reform is lower than expected; The wholesale price fluctuates greatly.
