\u3000\u30 China High-Speed Railway Technology Co.Ltd(000008) 58 Wuliangye Yibin Co.Ltd(000858) )
Key elements of the report:
The company released the annual report of 2021 and the first quarterly report of 2022 on April 28. In 2021, the company achieved a total operating revenue of 66.209 billion yuan (YoY + 15.51%), a net profit attributable to the parent company of 23.377 billion yuan (YoY + 17.15%), and a net profit not attributable to the parent company of 23.328 billion yuan (YoY + 16.67%). In 2022q1, the total operating revenue was 27.548 billion yuan (YoY + 13.25%), the net profit attributable to the parent company was 10.823 billion yuan (YoY + 16.08%), and the net profit not attributable to the parent company was 10.842 billion yuan (YoY + 16.35%), which was slightly lower than the market expectation. In addition, the company decided to distribute a cash dividend of 30.23 yuan for every 10 shares, with a total cash distribution of 11.734 billion yuan.
Key investment points:
Revenue continued to grow steadily and the marketing business model was fully launched: in 2021, the company achieved a total operating revenue of 66.209 billion yuan, a year-on-year increase of 15.51%, and a net profit attributable to the parent company of 23.377 billion yuan, a year-on-year increase of 17.15%; In 2022q1, the total operating revenue was RMB 27.548 billion, a year-on-year increase of 13.25%, and the net profit attributable to the parent company was RMB 10.823 billion, a year-on-year increase of 16.08%, continuing to maintain the double-digit growth of revenue and profit. By product, the gross profit margin of Wuliangye Yibin Co.Ltd(000858) liquor in 2021 was 85.59%, an increase of 0.64 PCT over the same period of last year, and the operating revenue increased by 11.46% over the same period of last year. The eighth generation Wuliangye Yibin Co.Ltd(000858) of core large single products has achieved “price stability and volume increase” as a whole, the terminal dynamic sales has reached a new high, and the volume price relationship has become more benign; Vintage Series classic Wuliangye Yibin Co.Ltd(000858) successfully introduced into the market. The collection and exchange of old wine are increasingly close, the quality charm of old wine is constantly recognized, and the time value of Wuliangye Yibin Co.Ltd(000858) old wine is further highlighted. In 2021, the gross profit margin of series liquor products was 59.67%, an increase of 3.99 PCT over the same period of last year. As the company’s series of liquor products adhere to the “three natures and one time”, focus on building four national strategic brands of wuliangchun, wuliangchun, wuliangtequ and Jianzhuang, take the growth brand and the total distribution brand as strategic synergy, and continuously optimize the brand structure, so that the volume and price of series of liquor products in the reporting period have increased simultaneously, and the operating revenue has increased by more than 50% compared with the same period of last year.
The channel construction has been upgraded, the marketing performance has been steadily improved, and the gross profit margin of distribution / direct selling mode is 79.19% / 85.05% respectively. Among them, due to the company’s increasing the cultivation of consumer opinion leaders and online direct sales, the sales revenue of direct selling mode has increased significantly, and the operating revenue of direct selling mode has increased by 64.37% over the same period of last year. Further expand emerging channels, continue to deepen strategic cooperation with national mainstream e-commerce platforms, and achieve new sales growth; The traditional terminal channels were further optimized, and the overall layout of Wuliangye Yibin Co.Ltd(000858) exclusive stores was more perfect, with store sales terminals accounting for more than 10%; Reach strategic cooperation with Huawei Group and Geely Group to further improve the group purchase network; Special expansion was carried out in 8 highland markets and 14 provincial capital level key markets in Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Hangzhou, Nanjing and Zhengzhou.
Profitability improved steadily and cash flow improved significantly: in 2021, the company’s gross profit margin was 75.35%, with a year-on-year increase of 1.19 PCT. During the period, the expense rate decreased slightly by 0.06 PCT to 11.86%, of which the sales expense rate was 9.82%, with a year-on-year increase of 0.09 PCT; The management fee rate was 4.38%, down 0.17 PCT year-on-year. To sum up, the net interest rate in 2021 increased by 0.54 PCT to 37.02% year-on-year. In 2022q1, the gross profit margin of the company was 78.41%, with a year-on-year increase of 1.98 PCT. During the period, the expense rate decreased slightly by 0.01 PCT to 9.28%, of which the management expense was 3.56%, a year-on-year decrease of 0.35 PCT; R & D expenses were 0.20%, with a year-on-year increase of 0.04 PCT. To sum up, the net interest rate increased by 1.06 PCT to 41.28%. In 2021, the company received 42 million yuan of dividends from financial companies of associated enterprises, resulting in a significant increase in cash inflow from operating activities, an increase of 644.02% over the same period of last year. Therefore, the company’s operating cash flow increased by 82.16% over the same period of last year.
Profit forecast and investment suggestions: as the leading brand of Baijiu Luzhou flavor, the eighth generation of core single product Wuliangye Yibin Co.Ltd(000858) Wuliangye Yibin Co.Ltd(000858) has achieved “price stability and volume increase” as a whole, and the series of liquor products have achieved “volume and price increase”; Vintage Series classic Wuliangye Yibin Co.Ltd(000858) was successfully introduced into the market, the product structure was further optimized, and the product value increased steadily. We maintain the company’s profit forecast for 22-24 years. It is expected that the company will realize a net profit attributable to the parent company of 27.7/321/36.6 billion yuan from 2022 to 2024, with a year-on-year increase of 19% / 16% / 14%, corresponding to EPS of 7.14/8.27/9.43 yuan / share. On April 29, the stock price corresponding to PE was 23 / 20 / 17 times, maintaining the “buy” rating.
Risk factors: policy risk, lower than expected demand for high-end wine, epidemic risk
