\u3000\u3000 Jason Furniture (Hangzhou) Co.Ltd(603816) (603816)
The company issued a performance pre increase announcement. It is estimated that the net profit attributable to the parent company will reach 1.65 billion yuan to 1.73 billion yuan in 2021, with a year-on-year increase of 95% to 105%; It is expected to realize the non net profit attributable to the parent deduction of RMB 1.42 billion to RMB 1.500 billion, with a year-on-year increase of 140% to 154%. The main reasons for the pre increase of performance are as follows: under the catalysis of the epidemic, the industry competition pattern has improved, the company gives full play to the advantages of channel side, the scale effect is gradually released, the brand influence is becoming more and more obvious, and the steady growth of sales and profits is promoted; ② In 2020, the provision for goodwill impairment was RMB 480 million, resulting in a low base in the same period. After excluding the impairment of goodwill, the net profit attributable to the parent company in 20 years is RMB 1.33 billion. Against the background of the sharp rise in the price of raw materials, the net profit attributable to the parent company in 21 years is expected to increase by 24% to 30% year-on-year.
The company continues to settle in new and old properties, and improves the degree of channel fine management through digital construction and store upgrading. Software home products have the characteristics of “bulk can not replace retail” and “online can not replace offline”. They are not diverted by bulk channels. In addition, the product itself focuses on experience and depends on offline scene transactions. Online channels can not completely replace offline retail layout. We believe that the epidemic objectively promoted local and small and medium-sized brands to withdraw from Ka stores, and the leading enterprises represented by Jason Furniture (Hangzhou) Co.Ltd(603816) gradually occupied more core positions. At the same time, the company improves channel efficiency and management refinement by strengthening information construction, promoting unified store construction and industrialized store construction mode.
Deepen the integrated product creation of guest dining and sleeping space, and comprehensively improve the product competitiveness of mattresses, sofas and cooperative brands. In the first three quarters, Jason Furniture (Hangzhou) Co.Ltd(603816) invested 195 million yuan in R & D, continuously enriched the product force matrix, significantly improved the competitiveness and scale proportion of supporting products, rapidly increased the growth of high-end mattresses, continuously enriched customized products, and increased the scale of clothes dryer categories. Promote product structure research and standardization, realize product disassembly, improve packing volume and transportation efficiency; Improve the high, medium and low-grade layout of products, supplement medium and high-end fabrics, increase the three defense function of medium and low-end fabrics, improve product competitiveness, and provide products with extreme cost performance through Tianxi school.
The gradual release of production capacity outside China and the continuous improvement of manufacturing efficiency have laid the foundation for scale expansion. In China, as of 21h1, the production capacity of the company’s five bases, namely dajiangdong in Hangzhou, Zhejiang, Xiasha in Hangzhou, Zhejiang, Jiaxing in Zhejiang, Huanggang in Hubei and Shenzhou in Hebei, has increased. The manufacturing side continues to explore in the direction of low-cost automation and fewer people, help reduce personnel and increase efficiency, promote the reform of production mode, and greatly improve the operation efficiency of production and manufacturing links. Overseas, with the gradual release of production capacity in Vietnam and Mexico, the stability of the company’s supply chain has been continuously enhanced, the efficiency of order delivery has been greatly improved, and the categories of export products have been continuously enriched, which is expected to open up the growth space of export revenue.
Profit forecast and Valuation: the company is the leader of China’s software home furnishings. Domestic sales gradually strengthen the synergy of regional retail centers, and strive to move towards large home furnishings in all categories and through multiple channels. With the gradual release of overseas production capacity, the categories of export products are more diversified, opening up the growth space of the export market. It is optimistic about the long-term development of the company and the accelerated improvement of the concentration of leaders, It is estimated that the net profit attributable to the parent company in the years 21, 22 and 23 will be RMB 1.67/20.8/2.55 billion respectively, with a year-on-year increase of + 97.7% / + 24.2% / + 22.7%, and the corresponding PE will be 27x / 22x / 18x respectively, maintaining the “buy” rating.
Risk warning: the forecast data is only preliminary accounting data; Raw material price fluctuation risk, production capacity release is less than expected, industry competition intensifies, etc.
