\u3000\u3 Shengda Resources Co.Ltd(000603) 043 Guangzhou Restaurant Group Company Limited(603043) )
Core view
The performance of 2022q1 increased by 10%, and it still maintained steady growth under the epidemic. In 2022q1, the company achieved a revenue of 747 million yuan / + 11.51%; Performance attributable to parent company: 53 million yuan / + 10.36%; The non deduction performance was 51 million yuan / + 13.23% (an increase of 21.19% compared with 2019), slightly higher than the 49 million yuan predicted by our performance forecast, and still maintained steady growth under the epidemic situation; EPS 0.09 yuan.
The income of quick freezing increased well, while the income of other foods decreased slightly. In 2022q1, the company achieved food revenue of 517 million yuan / + 6.00%, mainly driven by the growth of quick freezing business. Specifically, the quick freezing revenue was 274 million yuan / + 27.66%, slightly faster than that in the second half of last year (2021q3 / Q4 increased by 22.00% / 21.50% respectively), which was mainly supported by the continuous release of production capacity of Meizhou base; The off-season income of moon cake sales is 7.9819 million yuan / – 2.26%; The income from other foods was 235 million yuan / – 11.29%, mainly due to the repeated epidemic in China in the first quarter, the reduced demand for visiting relatives and friends during the Spring Festival, and the reduced demand for traditional Lunar New Year’s Eve food and gift boxes. Catering revenue was 218 million yuan / + 26.14%, mainly due to the combined contribution of six stores in Haiyue taoju in the second half of last year, but the expected profit recovery under repeated epidemics is still constrained. In addition, from the perspective of sales channels, the company’s direct sales revenue is 372 million yuan / + 13.88%, and the channel sales revenue is 364 million yuan / + 8.73%; The income of Guangdong Province is 612 million yuan / + 10.60% (influenced by catering, etc.), actively explore the market outside the province, and realize the income of 113 million yuan / + 15.94%. The growth rate outside the province is relatively faster. In 2022q1, the gross profit margin increased by 1.32pct and the period expense rate increased by 0.59pct. Capacity release helps growth, and the layout outside the province is expected to accelerate. The four bases of the company complement each other with cross regional advantageous products, and the product capacity of the whole line is guaranteed. Previously, the quick-frozen business was limited by the production capacity. With the trial production of 2021q3 in Meizhou base (the design capacity of quick-frozen is 24000 tons / year), the growth of the company’s quick-frozen and other food businesses this year has a good capacity support; At the same time, Xiangtan phase II was actively promoted, and it was announced in March this year that it plans to cooperate with Honghui Jiama food to speed up the production capacity layout in East China, and the continuous expansion of production capacity in the future can still be expected. In terms of channels, dealers outside the province will significantly speed up in 2021, which is expected to help the growth of food business. On the one hand, the catering business sees the recovery elasticity after the epidemic stabilizes and the potential release of taotaoju, and on the other hand, after the integration of taotaoju brand, the extension expansion is expected to accelerate. In addition, the company announced that its chairman plans to reduce its holdings of no more than 209000 shares by bidding in the next six months, no more than 25% of its holdings, accounting for 0.04% of the total shares of the company. It is expected to be a personal capital demand, and the overall impact is controllable.
Risk tip: macro, epidemic and other risks, food hygiene and safety, acquisition and integration, insufficient capacity release.
Investment suggestion: maintain the company’s EPS to 1.12/1.41/1.63 yuan in 20222024, corresponding to the PE valuation of 21 / 17 / 14x in 22-24 years, which is relatively low. Under the epidemic situation, the company maintained steady growth, released production capacity in the future, expanded across regions and enriched categories, supported the growth of food business, and maintained the “buy” rating for the recovery and growth of catering after taotaoju’s consolidation.
