\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) Tsingtao Brewery Company Limited(600600) 600)
Events
On the evening of April 28, 2022, the company released the first quarterly report of 2022: the total operating revenue of 2022q1 was 9.208 billion yuan (with an increase of 3%), the net profit attributable to the parent company was 1.126 billion yuan (with an increase of 10%), and the non net profit deducted was 1.022 billion yuan (with an increase of 17%).
Key investment points
The performance exceeded expectations, and the rising cost eroded part of the gross profit margin
The company’s total operating revenue in 2022q1 was 9.208 billion yuan (with an increase of 3%); The net profit attributable to the parent company was 1.126 billion yuan (with an increase of 10%) and the non net profit deducted was 1.022 billion yuan (with an increase of 17%), and the performance exceeded expectations. In March, covid-19 pneumonia spread in many places in China, which had a great impact on China’s beer consumption market and the company’s beer sales. It is not easy to achieve results. The gross profit margin of 2022q1 is 37.85% (with 7pct decrease), which is caused by the rise of raw materials and logistics costs. The net interest rate was 12.52% (with an increase of 0.7pct), mainly due to the sales expense rate of 14.20% (with a decrease of 8pct). In the first quarter, the company focused on the 2022 Winter Olympics, continued to enhance the brand influence through Wuxi Online Offline Communication Information Technology Co.Ltd(300959) series of promotion activities, accelerated the optimization and upgrading of product structure, and achieved good results from January to February 2022. The total sales volume of 2022q1 is 2.219 million kiloliters (the same decrease of 2.8%), and the corresponding ton price is 4300 yuan / kiloliter (the same increase of 6.1%). Among them, the sales volume of the main brand Tsingtao beer was 1.304 million kiloliters (an increase of 5.1% at the same time), maintaining a good growth trend. It is about to enter may day. We believe that the company is expected to accelerate the recovery of growth and further improve its profitability after entering the peak season.
The established brand strategy remains unchanged, and the high-end will continue
In 2022, the company will continue to promote the brand strategy of ” Tsingtao Brewery Company Limited(600600) main brand + the second brand of Laoshan beer”, and actively cultivate and develop strategic new products and new special products. The company will give full play to the advantages of production and sales network layout covering major markets in China, consolidate and improve its dominant position in the base market and its share in emerging markets, and build a consumer-centered marketing management system.
In addition, the company will build an ecosystem in which multiple business forms are deeply related, complementary and altruistic. Relying on the chain business of “tsingtao1903 Tsingtao Brewery Company Limited(600600) bar”, we strive to create a new highland for brand promotion, consumer experience, fresh beer and other high-end beer sales. The established high-end process of the company remains unchanged, and the product structure will continue to be optimized. Looking forward to 2022, with the continuous rise of raw materials, we believe that the company is expected to respond by raising prices directly or indirectly, and is expected to continue to release performance under the continuous optimization of product structure.
Profit forecast
We are optimistic about the continuous release of performance under the continuous optimization of the company’s product structure and the improvement of management efficiency. It is estimated that the EPS from 2022 to 2024 will be 2.50/2.99/3.48 yuan, and the current share price corresponding to PE will be 33 / 28 / 24 times respectively, maintaining the “recommended” investment rating.
Risk tips
Macroeconomic downside risks, consumption dragged down by the epidemic, lower than expected sales in peak seasons, lower than expected price increases, rising raw materials, etc.
