Basic conclusion
Air fryer: a new generation of small TV and large kitchen items under rapid expansion. In the past 20 years, the epidemic situation was superimposed with the catalysis of online traffic dividends, and the scale of the air fryer market ushered in an outbreak. In that year, the online sales (tmall, JD and Suning) were 3.5 billion yuan, with a year-on-year growth rate of 343%. In the 21st year, the offline catering scene resumed superimposing high base pressure, the growth rate of air fryer slowed down, and the annual online sales increased by 33%. At the current time point, from the perspective of the overall scale of the industry, there are two marginal changes that deserve special attention:
1) the air fryer has grown into a new generation of small electric appliances in the kitchen, with an annual cumulative sales of more than 6 billion. Among many small electric appliances in the kitchen, the sales scale of 22q1 is second only to the electric rice cooker. 2) The dividend of content grass planting continued to show. Since 21q4 (sales + 90%), air fryer has ushered in a new round of high growth, and 22q1 has further accelerated to 139% under the background of multiple outbreaks.
We believe that the reason why the air fryer can stand out from many small kitchen appliances with medium and long tail demand, become a large single product comparable to the traditional category of rice cooker, and usher in a new round of high growth at present: 1) the advantages of the product itself, strong functionality and practicability, and the selling points are in line with the current concept of healthy diet. 2) The epidemic situation has stimulated potential demand, accelerated the transformation, and the effect of grass planting with superimposed content continues to appear (the launch of air fryer content platform has been significantly strengthened since 21q4).
China’s air fryer market is highly concentrated, with the United States, nine Soviet countries coming from behind and accounting for half of the market share. In the period of rapid growth of industry scale, we believe that the United States, Kowloon and Soviet Union, which currently occupy the main share, are expected to continue to focus on benefits. The main reasons are as follows: 1) at present, the air fryer market still focuses on cost performance, and there is room for further improvement in concentration. The middle-end price of small household appliances has significant advantages in meijiusu brand and channel, which is also the fundamental reason why meijiusu can catch up and occupy the main share. 2) Bibcock has stronger technical synergy strength, can achieve breakthroughs among categories, occupy R & D advantages in the layout of multi-functional integrated high-end air fryer and air oven, and is expected to gain additional market share of ordinary oven.
Overseas: relatively scattered, JS global life and vesync’s brand Meiya have obvious advantages. The main players in the early stage of air fryer were foreign manufacturers who mastered the core technology, such as Philips, Teflon and so on. In 2018, ninja and cosori launched a single product of air fryer, which quickly occupied the American market with high cost performance. The large volume of air fryer drives the rapid growth of JS global life and the corresponding business income of vesync.
Upstream – Biyi shares: the first share of air fryer, benefiting from the prosperity of the industry and high income growth. The global air fryer OEM leader benefited from the high prosperity of the air fryer industry, and the company’s revenue grew beautifully. In 21 years, the revenue was 1.6 billion yuan, a year-on-year 40% and a compound 19-year growth rate of 49%.
Investment advice
The air fryer has outstanding functionality and practicability, and its selling points are in line with the current concept of healthy diet. It stands out from many small household appliances that meet the needs of long tail segmentation, and has grown into a new generation of small TV and University items in kitchen, with a scale comparable to that of traditional electric rice cookers. Since 21q4, the dividend of content grass planting has continued to show, and the air fryer is experiencing a new round of high growth. Under the trend of family miniaturization, there is sufficient room for the growth of small kitchen appliances in China in the long run. It is suggested to pay active attention to the key beneficiaries, including the traditional small household appliance leaders Midea Group Co.Ltd(000333) , Zhejiang Supor Co.Ltd(002032) , Joyoung Co.Ltd(002242) , which occupy the main market share and compete for the high-end layout; Air fryer is an emerging small household appliance leader with rapid expansion of single product scale Bear Electric Appliance Co.Ltd(002959) ; Biyi Co., Ltd., the global OEM leader of air fryer benefiting from the high prosperity and high income growth of the industry.
Risk tips
Risk of terminal demand decline; Risk of rising raw material costs; Exchange rate and shipping risk; Industry competition intensifies risks.
