Mengtian home (603216)
Wooden door industry is a typical large industry and small company, and the leading concentration has great room to improve. The scale of China’s wooden door industry exceeds 100 billion. In 2020, the scale of China’s wooden door market was about 147 billion yuan, and the industry scale has maintained stable growth in recent years. From the perspective of quantity, the total demand for wooden doors in China will be 127.83 million in 2020, of which the demand for solid wood doors, solid wood composite doors, molded doors and steel wood doors account for 13%, 49%, 24% and 8% respectively. Tata, Mengtian and other brands are the first tier brands in the field of wooden door retail. Leading enterprises continue to expand categories, and professional wooden door brands are scarce. At present, the enterprises covering wooden doors in China’s A-share listed companies are divided into two categories (1) customized enterprises with wooden doors as the leading products, mainly including Jiangshan Oupai Door Industry Co.Ltd(603208) and Mengtian home. (2) Customization enterprises gradually expand from kitchen cabinets and wardrobe to wooden doors, mainly including Oppein Home Group Inc(603833) , Suofeiya Home Collection Co.Ltd(002572) , Zbom Home Collection Co.Ltd(603801) , Goldenhome Living Co.Ltd(603180) , Guangzhou Holike Creative Home Co.Ltd(603898) .
Mengtian Home Group Co., Ltd. is the earliest enterprise in China to develop, produce and sell wooden composite doors. Mengtian wooden door products are positioned at the middle and high end and are the leading brand of wooden doors in China. At present, the company has 1171 distribution stores, with a total of 974 distributors. There are two manufacturing bases in Qingyuan, Zhejiang and Jiashan, Zhejiang. In the first three quarters of 2021, the revenue was beautiful, reaching 962 million yuan, a year-on-year increase of + 32.77%. Products: from wooden door to woodwork, realize the integration of door and wall cabinet, and launch differentiated “water-based paint” products. The company’s main products are “Mengtian” brand series of wooden doors, wallboards, cabinets and other furniture products. The company carries out various matrix combinations for wood doors, cabinets, wallboards and other products, realizes the style matching of multiple series, and strengthens the integrated product strategy of doors and wallboards.
Channel: the distribution channel accounts for more than 90% of the income, and the multi-channel layout of home decoration and engineering. The sales revenue of distribution channels in 2020 and 2021h1 is RMB 1.115/487 billion respectively, and the revenue of bulk engineering business in 2020 and 2021h1 is RMB 71.23 million and 30.58 million respectively. By 2020, the company has a total of 31.5 class a dealers, 232 class B dealers and 743.5 class C dealers. The company implements unified, hierarchical and centralized management of dealers, and the country is divided into two major war areas and 12 sales areas. Improve the dealer assistance system and continuously enable the development of dealers: (1) each region is equipped with an active marketing team and a marketing team to be responsible for the marketing, promotion and other assistance activities in their respective theater; (2) The company establishes positive and negative incentive rebate policies for dealers’ payment collection objectives according to the achievement of objectives. (3) Subsidy system: in terms of fine decoration store decoration discount, the company will give sample discounts ranging from 4-7% respectively according to the number of stores, area and dealer level; (4) Management system: the company’s dealers enjoy exclusive distribution, publicity and management authority in a certain sales area. The company’s stores are mainly divided into wooden door standard stores, wooden door comprehensive stores, home decoration stores and woodwork experience stores.
Profit forecast and rating: the company is the target of the scarcity of wooden door retail track. The brand influence of “Mengtian” is strong and the channel management ability is leading in the industry. We are optimistic about the long-term development of the company. It is estimated that the operating revenue of the company in 21-23 years will be RMB 1.519/18.28/2204 billion, the growth rate will be 23.82% / 20.32% / 20.61% respectively, and the net profit attributable to the parent company will be RMB 187 / 230 / 284 million, The growth rate is 9.38% / 22.86% / 23.68% respectively, and the corresponding PE is 29x / 24x / 19x respectively. Referring to the PE of comparable companies, we give the company a 22-year reasonable PE range of 25-28x, a target market value range of 5.6-6.3 billion yuan, and a “overweight” rating for the first time. Risk tips: the real estate policy is tightened, the competition is intensified, the dealer management and the expansion of new channels are less than expected, there have been stock price changes recently, the risk of Evergrande’s accounts receivable not being fully cashed when due, and the risk of brand and product counterfeiting
