Event comments
On January 20, the agriculture, forestry, animal husbandry and fishery sector rebounded strongly. As of 10:20 a.m., Shenwan agriculture, forestry, animal husbandry and fishery index rose 2.70%. Among individual stocks, Cnfc Overseas Fisheries Co.Ltd(000798) , Shandong Xiantan Co.Ltd(002746) rose more than 10.00%, Hunan Zhenghong Science And Technology Develop Co.Ltd(000702) rose 9.96%, Pulike Biological Engineering Inc(603566) rose 7.62%, Wens Foodstuff Group Co.Ltd(300498) rose 4.52%.
The prosperity of prefabricated vegetables is upward, and the breeding enterprises that arrange deep processing in advance have the first mover advantage. Under the condition of normalization of epidemic prevention and control, the prefabricated vegetable industry that meets the residents’ festival consumption and the needs of “house economy” and “cloud life” has ushered in a warm wind. It has convenient production, diverse categories, wide sales range and caters to the home consumer market. With the government’s encouragement of the “local new year” policy, it is expected that its future demand will be further improved and there will be broad development space. At present, the prefabricated vegetable industry is still in a period of rapid growth, with many competitors and no leading enterprise. In the agricultural sector, Zhanjiang Guolian Aquatic Products Co.Ltd(300094) , Shandong Xiantan Co.Ltd(002746) and other enterprises have first mover advantages: upstream deep cultivation and breeding, with significant cost and procurement advantages; The midstream layout of deep-processing track in advance, with comprehensive product categories and rich product matrix, has the advantages of R & D and products; The distribution of downstream channels is diversified, taking into account the layout of catering, supermarkets and new retail. Breeding enterprises that arrange deep-processing products in advance can quickly occupy the market share of prefabricated vegetables by taking advantage of low cost, strong R & D strength and wide sales channels.
The turning point of the pig cycle is approaching, and attention is paid to the steady operation of pig enterprises. In terms of the duration of this round of pig cycle, it has lasted nearly 45 months since April 2018, reaching the average duration of nearly three historical cycles (45 months). In terms of the decline range of pig price, according to the Yongyi data, from March 2021, the pig price has fallen from the high point of 36.29 yuan / kg to 14.17 yuan / kg on January 20, with a decline range of more than 60%. With the downward trend of pig cycle and the decline of pig price, the pig breeding industry has made significant losses in both self breeding and outsourcing piglet models, Muyuan Foods Co.Ltd(002714) and Wens Foodstuff Group Co.Ltd(300498) 2021q3 net profit attributable to mother has lost 821 million yuan and 7.203 billion yuan respectively, with a year-on-year decrease of 108.05% and 276.21% respectively. The turning point of the pig cycle may appear in the second quarter of 2022 from July 2021, when the breeding sows begin to be depopulated and the pigs are released from October to December. At present, the valuation of the sector has fully returned, and the P / E ratio and head average market value of pig enterprises have reached the low point. It is suggested to pay attention to pig enterprises with stable cash flow, significant cost advantage and stable operation.
The recovery of pig price drives the boom recovery of post cycle sector, and attaches importance to the investment opportunity of dynamic insurance. Under the background of the downward pig cycle, in order to spend the “cold winter” and reduce costs, the demand for vaccines and other animal protection products has been impacted. At present, the pig cycle has entered the bottom stage. With the rebound of pig prices, the demand for animal protection products such as vaccines is expected to improve. In addition, the scale of pig breeding industry in this cycle has been greatly improved. In 2021, Muyuan Foods Co.Ltd(002714) , Wens Foodstuff Group Co.Ltd(300498) , Jiangxi Zhengbang Technology Co.Ltd(002157) , New Hope Liuhe Co.Ltd(000876) pigs were sold a total of 78.3861 million, accounting for 14.25% of the national total, with a year-on-year increase of 5.63 PCT. According to the veterinary drug development report, the average epidemic prevention cost of large-scale farms is more than 30% higher than that of free range breeding. With the large-scale development of the pig industry, the animal protection industry is expected to continue to expand. At present, the valuation of the sector has been significantly adjusted back to the historical bottom range. It is recommended to pay attention to dynamic insurance enterprises with strong R & D ability and outstanding production and marketing.
Investment advice
At present, the bottom of the pig cycle is relatively clear, and pig enterprises have a high safety margin. It is suggested to pay attention to pig enterprises with stable cash flow, significant cost advantage and stable operation. The epidemic situation promotes the prosperity of prefabricated vegetables. It is suggested to pay attention to breeding enterprises with rich product categories, perfect supply chain and first mover advantages in the field of prefabricated vegetables. The recovery of pig prices has led to the boom recovery of the post cycle sector. It is suggested to pay attention to dynamic insurance enterprises with R & D and innovation advantages.
Risk tips
Tip 1: macroeconomic fluctuations;
Tip 2: non plague situation;
Tip 3: extreme weather effects, etc.
