\u3000\u3000 Huali Industrial Group Company Limited(300979) (300979)
Vietnam's epidemic control has been normalized, and Huali factory has no great impact
At present, Vietnam's epidemic prevention strategy has been adjusted. Since most of the confirmed cases in Vietnam are mild or asymptomatic, the local epidemic prevention policy has changed from "clearing" to "coexisting with the virus" to promote economic recovery. If there is a case of employee diagnosis or indirect contact, the whole plant is not required to stop production.
From the perspective of Huali epidemic prevention measures, Vietnam factories still implement relatively strict epidemic prevention measures, basically continuing the previous practice, regularly conduct nucleic acid testing for employees, and actively organize employees to vaccinate. At present, the vaccination rate of Vietnamese factory employees is high, and the third vaccination has been started. According to the daily attendance statistics of Huali factory, the attendance rate of Vietnam factory has been maintained at a normal level, and the completion rate of daily production plan is high.
The medium and long-term locking of customer orders is high, and the share of Nike brand supply chain can be improved
All brands cooperated by the company will have plans for more than 3 years, and some customers will have plans for 5 years or even 8 years; Usually, customers will also issue advance orders for the next quarter so that the company can prepare for production capacity in advance.
Up to now, the customer's order demand and order forecast are still strong. The company makes every effort to ensure the order delivery in all factories in northern Vietnam, and all production plans are basically carried out in accordance with the established objectives. As of 21q3, the customers with relatively large order growth are mainly Nike and Deckers, and other major brands will also have a certain growth rate.
We expect that in the future, Huali's order share in Nike, especially its Nike brand, will increase positively. Compared with its main competitors Yuyuan and Fengtai enterprises, Huali's production capacity will expand actively, reflecting a strong competitive advantage and in an upward range. Huali has strong new product development ability, can quickly respond to changes in market demand, actively expand production capacity and effectively control product costs. After the epidemic and epidemic, Huali can better highlight the company's core competitive advantages and attract sports brands to increase orders to the company.
Continuous release of production capacity, leading the industry and ensuring the growth of scale and performance
Huali is one of the few manufacturers in the industry that can still actively expand production capacity on a large scale. Over the years, the high growth model can support the continuous opening of new factories. The multi customer model + performance growth drives the opening of new factories every year. Talent and team training can match the progress of the group's opening of new factories; Meanwhile, Huali customers hope to provide more production capacity. In 2021, the production capacity increased significantly compared with the previous year. In the future, considering the demand of customer orders, the company will still maintain positive production capacity expansion.
In the next few years, the three new plants put into operation in Vietnam in 2021 will reach production capacity one after another, and the plants in Indonesia are also under construction as planned. The phase I plant in Indonesia is expected to be put into operation by the end of this year and contribute to production capacity next year; Accelerate the construction of Myanmar factories after the local situation is stable; In addition, it will continue to expand and build new factories in Vietnam.
Maintain profit forecast and give buy rating
The company is engaged in the development, design, production and sales of sports shoes. It is a leading professional manufacturer of sports shoes in the world. The company's main production base is located in the northern region of Vietnam. In 2021, many shoe factories and shoe material supply enterprises in southern Vietnam suspended operations to meet the epidemic prevention requirements of the local government of Vietnam, resulting in a shortage of production capacity of international brand sports shoes. The Vietnamese factory of the company maintains normal operation, and actively expands production capacity to meet the increasing order demand of customers; From January to September 2021, the company sold 153 million pairs of sports shoes, with a year-on-year increase of 30.43%. We estimate that the company's revenue in 21-23 years will be 18.8, 23.5 and 29.4 billion yuan respectively, the net profit attributable to the parent company will be 2.7, 3.4 and 4.2 billion yuan, the EPS will be 2.3, 2.9 and 3.6 yuan / share respectively, and the PE will be 35, 28 and 23 times respectively.
Risk tip: repeated overseas epidemics lead to lower than expected order growth, higher labor costs, concentration of production bases and customers and other risks.
