Key investment points:
The wholesale price of high-end liquor rebounded slightly, and the cost of mass products is still under pressure
According to the data of April 2022, the wholesale price of high-end Baijiu has rebounded, and the price of raw materials of popular products continues to rise. Among them, the price of a batch of Feitian Moutai 53 degree (500ml) high-end Baijiu peaked at 3300 yuan before the Spring Festival last year and fluctuated after a slight drop after the festival. The price continued to decline after reaching 3880 yuan before the National Day holiday last year. Recently, affected by the cancellation of the unpacking sales policy, the batch price of the original case further fell. After the Spring Festival, the price continued to fall slightly. At present, the price has rebounded slightly to 2970 yuan. Beer and wine prices did not fluctuate significantly, but due to the impact of the epidemic, beer production fell significantly in April. In terms of cost environment, the price of pork is close to the relative bottom. After a slight rebound in the short term, the price of fresh milk is flat month on month. The rise of Shenzhen Agricultural Products Group Co.Ltd(000061) price has been accelerated by geopolitical factors recently, and the price of packaging materials fluctuates slightly. At present, the cost environment is still facing certain pressure to be observed.
Investment advice
In April, with the continuous adjustment of the sector, the valuation of some leading segments has been close to the low point in the past decade, the investment value has appeared, the demand for quick-frozen food and prefabricated vegetables under the catalysis of the epidemic has increased, and the overall good performance of the industry in the first quarter has enabled the sector to open a short-term repair market. From the monthly data, the impact of the epidemic was more obvious in the second quarter, but with the gradual resumption of work and production in key areas, the consumption scene is expected to continue to recover. At the current time point, we believe that each fine molecule industry has configuration value, and we suggest continuous attention. In terms of sectors, high-end Baijiu with greater certainty is still recommended. In terms of popular products, it is suggested to select the dairy industry with downward cost determination during the year and the beer sector with relatively better competition pattern and smoother pressure transmission. The beer sector will continue to benefit from the gradual recovery of consumption scenes after the epidemic, with the positive impact of price increase and high-end products, and high growth is expected. To sum up, we temporarily give the industry a “neutral” investment rating, and recommend Kweichow Moutai Co.Ltd(600519) ( Kweichow Moutai Co.Ltd(600519) ), Angel Yeast Co.Ltd(600298) ( Angel Yeast Co.Ltd(600298) ), Chongqing Fuling Zhacai Group Co.Ltd(002507) ( Chongqing Fuling Zhacai Group Co.Ltd(002507) ), Chongqing Brewery Co.Ltd(600132) ( Chongqing Brewery Co.Ltd(600132) ) and Inner Mongolia Yili Industrial Group Co.Ltd(600887) ( Inner Mongolia Yili Industrial Group Co.Ltd(600887) ).
Risk tips
Macroeconomic downside risks, major food safety risks, and epidemic prevention and control are less than expected.
