\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 57 Yunnan Botanee Bio-Technology Group Co.Ltd(300957) )
Key investment points
Event: the company released the first quarter report of 2022. In the first quarter of 2022, the company achieved an operating revenue of 810 million yuan, a year-on-year increase of 59.3%, a net profit attributable to the parent company of 150 million yuan, a year-on-year increase of 85.6%, a deduction of non attributable net profit of 120 million yuan, a year-on-year increase of 61.8%, and a rapid growth in revenue performance.
The main brand continues to grow rapidly, and a complete product matrix is built around "Winona". In the first quarter of 2002, the company's revenue increased significantly, mainly contributed by the core brand "Winona". From the perspective of channels, the growth rate of online channels such as tmall, jd.com and Tiktok reached 50%, the growth rate of private domain applet channels was also above 50%, and the growth rate of offline Watsons channels was 40%-50%; In terms of products, the top three products in terms of growth rate are facial mask, essence and special care cream. On the basis of "Winona" brand, we will intensify the launch of new products, mainly focusing on essence products, focusing on creating two single products: Anti-aging Essence and whitening essence. At present, essence products account for 15%.
Reasonable cost control and substantial improvement in profitability. In the first quarter of 2022, the gross profit margin of the company was 77.8%, a year-on-year decrease of 0.3pp, the net profit margin was 18.1%, a year-on-year increase of 2.6pp, and the net profit margin was greatly improved. The company's sales expense rate, management expense rate and R & D expense rate were 48%, 7.6% and 3.8% respectively, with a year-on-year increase of 2.1pp, a decrease of 0.4pp and a decrease of 0.7pp respectively. The company's sales expenses account for the largest proportion, mainly from the brand image promotion expenses and the salary expenses of marketing personnel. It continues to increase the marketing investment, consolidate its leading position in domestic products on the subdivision track of efficacy skin care products, and continue to strengthen the brand effect. In the first quarter, the company realized an investment income of 21.561 million yuan, an increase of 20.839 million yuan year-on-year, which made a great contribution to the improvement of net interest rate. After deducting non recurring profits and losses, the net interest rate remained stable.
Diversified operation and actively promote sub brand incubation. The company adopts diversified operation strategies online, carries out various marketing activities such as "New Year's Day", "Valentine's Day" and "38 goddess day" on the platform, enhances brand exposure, continuously drives sales, and shapes the brand image and expands its influence through star endorsement, member salon and public welfare activities. At the same time, actively promote the incubation of sub brands. The company plans to build Winona baby brand into the first brand of infant skin care in China in the next three years. In addition, as a strategic layout, aoxmed, a high-end line, is expected to continue to increase in volume, and is expected to become a revenue contribution pillar parallel to Winona in the future.
Profit forecast and investment suggestions. It is estimated that the company's EPS from 2022 to 2024 will be 3.06 yuan, 4.42 yuan and 6.14 yuan respectively, and the net profit attributable to the parent company will maintain a compound growth rate of 44.5% in the next three years. Considering that the company is the leading domestic product of functional skin care products, the core brand still has large market space and maintains the "hold" rating.
Risk tip: the risk of intensified industry competition and less than expected new product promotion.
