\u3000\u3 China Vanke Co.Ltd(000002) 385 Beijing Dabeinong Technology Group Co.Ltd(002385) )
Event: Beijing Dabeinong Technology Group Co.Ltd(002385) released the report for the first quarter of 2022, and the company realized an operating revenue of 6.46 billion yuan, a year-on-year decrease of 12.73%; The net loss attributable to the shareholders of the listed company was 232 million yuan, a year-on-year change from profit to loss; The net loss attributable to shareholders of listed companies after deducting non recurring profits and losses was RMB 271 million, which was converted from profit to loss year-on-year.
Key investment points:
The main business is greatly affected by the cycle, and the profit turned into loss in the first quarter year-on-year. In terms of feed, feed is the company's main business ballast, with an annual revenue of 22.695 billion yuan, accounting for 72.44% of the total revenue, accounting for a stable proportion, providing important cash flow support for the development of breeding and other businesses. However, the feed business was affected by the 21-year Shenzhen Agricultural Products Group Co.Ltd(000061) bulk cycle, and the price of raw materials rose. In the past 21 years, the proportion of the cost of feed raw materials in the operating cost of the company increased by 1.18% year-on-year; The gross profit margin of feed business was 13.19%, with a year-on-year increase of - 2.57%. In terms of breeding, the company's marketing has maintained rapid growth in 21 years, but the downward pressure on the cycle has increased, which has a great negative impact on the company's overall profit realization. In 21 years, the company sold 2.5115 million, an increase of 129.05% year-on-year. At the end of the year, the three yuan price of live pigs decreased by 56.5% compared with the beginning of the year. In the whole year of 21, the gross profit of the company's breeding business was -6.55%, with a year-on-year increase of -58.89%. In the first quarter, the pressure of feed and breeding cycle was still on, deducting non net profit of - 271 million yuan, which turned from profit to loss year-on-year. On the one hand, affected by the global epidemic and the Russian Ukrainian crisis, Shenzhen Agricultural Products Group Co.Ltd(000061) bulk feed raw material prices are still strong, affecting feed profits; On the other hand, the relationship between supply and demand of pigs is still loose. After the Spring Festival, the pig price bottomed out twice, putting pressure on the breeding business. According to the estimation of pig sales in the first three quarters of the company, the overall average sales price of the company in the first quarter of 22 was about 13 yuan / kg. We expect the average loss of the company in that quarter to be 400500 yuan / head.
The impact of the cycle is expected to weaken, and the seed industry is ready to expand. Highlight 1: the main business of the company is expected to be weakened by the cycle in the future. First, the worst time point of the pig cycle may have passed. As of April 29, the price of live pigs (foreign three yuan) was 14.82 yuan / kg, up 25.8% from the low in March. The profit of breeding will be replenished, and pig breeding is expected to rise. Second, the price of feed raw materials is expected to improve with the epidemic and other factors, repair the supply chain and ease the cost pressure. Highlight 2: the company is expected to grasp the historical opportunity of biological breeding. In January, 2004, four regulations related to biological breeding, including the administrative measures for the safety evaluation of agricultural genetically modified organisms, officially came into force. The industrialized application of biological breeding is expected to be promoted continuously and orderly, and it is expected to be popularized in 22 / 23. At present, Beijing Dabeinong Technology Group Co.Ltd(002385) transgenic maize products dbn9936, dbn9501, dbn3601t and soybean dbn9004 have obtained safety certificates, leading in technology and approval preparation. The company has cooperated with more than 100 seed companies in China, with a corresponding promotion area of more than 100 million mu. It is expected to take the lead in transforming considerable biological breeding business income.
Investment advice
Beijing Dabeinong Technology Group Co.Ltd(002385) is a high-quality target of agricultural science and technology covering feed, animal protection, seed industry and other fields. In the future, the company's breeding and feed cycle pressure is expected to ease, and biological breeding is ready to take off. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be 88 million yuan, 2.276 billion yuan and 2.637 billion yuan respectively, and the EPS will be 0.02 yuan, 0.55 yuan and 0.64 yuan respectively, corresponding to pe338, 13 and 11 times, which will be rated as "buy".
Risk tips: feed raw material price fluctuation, pig cycle fluctuation, policy less than expected and other risks.
