\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 519 Kweichow Moutai Co.Ltd(600519) )
Events
On April 26, 2022, the company released the first quarterly report of 2022: the total revenue of 2022q1 was 33.187 billion yuan, an increase of 18.3% at the same time; The revenue was 32.296 billion yuan, an increase of 18.43% at the same time; The net profit attributable to the parent company was 17.245 billion yuan, an increase of 23.58% at the same time; Deduct non net profit of RMB 17.243 billion, an increase of 23.43% at the same time.
Key investment points
The quarterly report has steadily improved its profitability
In 2022q1, the total revenue was 33.187 billion yuan, an increase of 18.3% at the same time; The revenue was 32.296 billion yuan, an increase of 18.43% at the same time; The net profit attributable to the parent company was 17.245 billion yuan, an increase of 23.58% at the same time; Deduct non net profit of RMB 17.243 billion, an increase of 23.43% at the same time. Compared with the previous performance forecast, the profit exceeded the market expectation. The gross profit margin of 2022q1 was 92.37% (with an increase of 0.7pct), which was due to the continuous optimization of the company’s product structure, especially the large volume of Maotai 1935. The net profit margin of 2022q1 is 55.96% (with an increase of 1.4pct), which is due to the increase of sales expense rate (with a decrease of 0.4pct), management expense rate (with an increase of 0.1pct) and business tax and surcharges accounting for 13.07% (with a decrease of 0.6pct). At the end of 2022q1, the contract liabilities were 8.322 billion yuan, a month on month decrease of 4.4 billion yuan and a year-on-year increase of 3 billion yuan. The net cash flow from operating activities in 2022q1 was – 6.9 billion yuan, which was caused by the decrease of funds absorbed by other member units of the group company by the holding subsidiary group finance Co., Ltd. 31.488 billion yuan was collected in 2022q1, an increase of 41% at the same time, and the trend continued to improve. Business objectives for 2022: first, the total operating revenue increased by about 15% over the previous year; Second, 6.969 billion yuan was invested in capital construction.
The proportion of direct sales increased significantly, and the feedback from e-commerce platforms was good
By product, the revenue of Maotai liquor in 2022q1 was 28.86 billion yuan (with an increase of 17.4%), and that of series liquor was 3.428 billion yuan (with an increase of 30%). Sub channels: direct sales channels were 10.887 billion yuan, with an increase of 128%, accounting for 33% (with an increase of 16pct); Wholesale channels reached 21.4 billion yuan, a decrease of 5% over the same period. By region, China’s 31.522 billion yuan, an increase of 18.6%; Foreign investment reached 766 million yuan, an increase of 16.6%. By the end of 2022q1, there were 2086 dealers in China and 104 dealers abroad.
“I Maotai”, launched at the end of March, currently has four products: 53 ° 500ml Kweichow Moutai Co.Ltd(600519) liquor (year of the renyin tiger), 53 ° 500ml Maotai 1935, 53 ° 375ml 2 (year of the renyin tiger), 53 ° 500ml Kweichow Moutai Co.Ltd(600519) liquor (treasures). I on the first day of Maotai trial operation, 26328 bottles of Maotai products were put into operation, and a total of 2.99 million people and 6.22 million people participated in the purchase within one hour. The launch of the new e-commerce platform marks the acceleration of the company’s reform process. At present, the platform is in the trial operation stage, and the company is expected to enter the fast lane.
Maotai new measures, optimization and adjustment is an important aspect
At the end of August 2021, Ding Xiongjun became the chairman of Maotai and proposed the direction of the company’s reform: marketization and legalization, releasing positive signals.
During the 14th Five Year Plan period, the optimization and adjustment of Maotai was an important focus, which was mainly divided into price adjustment, product structure adjustment and channel structure adjustment. In terms of price, the company has cancelled the unpacking policy and returned to marketization. The wholesale price of whole Mao and scattered Mao is expected to continue to narrow. We expect Maotai to raise the price at least once during the 14th Five Year Plan period. In terms of product structure, we believe that the company will continue to adjust the proportion of non-standard products to drive the ton price increase. This is also confirmed by the price increase of non-standard products since this year; The product structure of series liquor will be continuously optimized, and the “big single product” strategy will be implemented internally. The “1 + n” big single product group with Maotai Prince liquor as the core, Han sauce and Guizhou Daqu have become 1 billion big single products. The adjustment of channel structure is another important focus during the 14th Five Year Plan period. In the future, the dealer quota will remain unchanged, and the company will focus on developing direct channels (including self-supporting, e-commerce, supermarket and enterprise group purchase). Since 2018, the company has paid more attention to the launch of direct marketing channels, especially in peak seasons such as the Mid Autumn Festival, national day and Spring Festival. It has successively signed Maotai quotas with national supermarkets such as Yonghui, regional supermarkets such as Better Life Commercial Chain Share Co.Ltd(002251) , e-commerce such as tmall, jd.com and other non distribution channels, so as to increase the breadth, depth and frequency of contact with consumers and increase the bottle opening rate of Maotai in that year.
Profit forecast
We continue to be optimistic about the brand moat, the medium and long-term pattern of high-end liquor is still stable, and the role of Maotai sea god needle is still obvious. It is estimated that the EPS from 2022 to 2024 will be 49.62/58.00/67.41 yuan respectively, and the corresponding PE of the current stock price will be 35 / 30 / 26 times respectively, maintaining the “recommended” investment rating.
Risk tips
Macroeconomic downside risk, consumption dragged down by the epidemic, less than expected capacity expansion, less than expected growth of direct channels, less than expected reform process, rapid upward risk of pricing, etc.
