\u3000\u3000 Sichuan Teway Food Group Co.Ltd(603317) (603317)
Event: the company issued a performance forecast for 2021. Today, the company released the performance forecast for 2021. It is expected to achieve an operating revenue of 2.03 billion yuan, a year-on-year increase of - 14.3%, a net profit attributable to the parent of 180 million yuan, a year-on-year increase of - 51.0%, and a deduction of non attributable to the parent of 120 million yuan, a year-on-year increase of - 62.4%, which is basically in line with the expectation.
Revenue side: due to the shortage of logistics and packaging materials, the recognition of some revenue is delayed. In 2021q4, it is expected to achieve a revenue of 630 million yuan in a single quarter, a year-on-year - 25.2%, slightly lower than the market expectation. We expect that it is mainly due to the shortage of logistics and upstream packaging materials and the dislocation of delivery. According to the channel research, due to the downward price of pork this year, under the background of increasing demand for winter seasoning, the company made strategic layout ahead of competitive products, and the seasoning dynamic sales in winter were better, which provided strong support for income growth.
Profit side: the profit is under pressure due to many factors such as cost, expense and product structure, and the performance of 21q4 is in line with expectations. In 2021, the cost of packaging materials, oil and other raw materials increased. At the same time, the adjustment of product structure led to the decline of gross profit margin, the investment of superimposed expenses increased, and the net profit decreased significantly year-on-year in 2021. In 21q4, the company hedged the price increase of some products to a certain extent, and the net profit attributable to the parent company in 21q4 was 100 million yuan, a year-on-year increase of + 123.2%, which was in line with the pre judgment. Looking ahead to this year, we expect that as the industry competition slows down and some small and medium-sized brands withdraw, the company's sales expense investment may be narrowed. At the same time, the price increase will also make a certain positive contribution to the profit. We expect that the profit side will be more flexible in 2022.
Long term outlook: the industry demand is expected to pick up and is optimistic about the long-term development of the company. After nearly a year of channel inventory cleaning, the company's channel inventory has been cleaned up to a benign level. At the same time, according to grassroots research, the age of terminal products has also been significantly narrowed. We expect that with the recovery of C-end demand and the company's adjustment of products, channels and internal organizational structure, the reform dividend is expected to be released gradually. B. Under the background that the recovery logic of the C-end remains unchanged and the long-term penetration space needs to be improved, we believe that there is a broad space for the re adjustment industry. It is expected that the industry is still expected to maintain a double-digit growth of 10-15% in the next 3-5 years. As a leader in the development of the industry, the company actively carries out capacity layout and product expansion, which is expected to maintain the growth level beyond the industry and is optimistic about its long-term development space.
Investment suggestion: we expect the company's operating revenue to be RMB 2.03/25.4/3.1 billion in 2021 / 2022 / 2023, with a year-on-year increase of - 14.3% / + 25.4% / + 22.0%; The net profit attributable to the parent company was 180 / 3.0 / 370 million yuan, a year-on-year increase of - 51.0% / + 70.3% / + 23.1%; The corresponding PE is 96 / 56 / 46 times respectively, maintaining the "buy" rating.
Risk warning: market competition intensifies the risk; The company's channel development progress is lower than expected.
