\u3000\u3000 Shanxi Xinghuacun Fen Wine Factory Co.Ltd(600809) (600809)
Fenjiu released the performance forecast. It is estimated that the net profit attributable to the parent company in 2021 will be 5.234 billion yuan – 5.542 billion yuan, an increase of 2.155 billion yuan – 2.463 billion yuan over the same period of last year, a year-on-year increase of 70% – 80%.
Key points supporting rating
The blue and white series has been growing rapidly, and both domestic and foreign markets have achieved rapid growth. Net profit increased by 70-80% in 2021, leading the Baijiu industry. (1) In terms of products, the company promotes the strategy of high-end products, improves the awareness of fragrance categories, and focuses on blue and white, strengthening waist and stabilizing glass Fen. The blue and white brand has a good potential. The revived version of green 30 lays out the 1000 yuan price belt and drives the sales of sub high-end green 20. The blue and white series has achieved high-speed growth as a whole. Zhuyeqing’s performance is also very bright. According to Weijiu news, the revenue of Zhuyeqing will double in 2021. (2) From a subregional perspective, the province has benefited from the coal economy, the market outside the province has increased rapidly, the market expansion in the south of the Yangtze River has been strengthened, and steady breakthroughs have been made in the markets of Jiangsu, Zhejiang, Shanghai, Anhui and Guangdong. (3) At the beginning of 2021, the company optimized the marketing organization structure and completed the alternation of new and old marketing backbone. The post-80s generation became the main person in charge of regional and provincial managers. A large number of post-90s marketing personnel enriched the sales front line, which stimulated the endogenous power of the marketing team. The dealer structure and channels have been continuously optimized, and there are more than 1 million controllable terminal outlets in the national market.
The net profit in the fourth quarter of the year was – 42.6% to + 7.3% year-on-year. The median net profit fell, and the performance in the first quarter of the year is expected to grow high. Due to the good completion of the plan from the first to the third quarters of the 21st year and the revenue increase of 66%, the driving force of shipment in each area in the fourth quarter is weak. To clean up inventory and prepare for the coming year, we judge that the pace of revenue recognition in the fourth quarter is slow, but the terminal demand still maintains a strong growth trend. Considering the benign market condition at the end of 2021 and the inventory at a historically low position, the Spring Festival in 2022 is expected to start well, and the performance is expected to increase high in the first quarter of 22 years.
Strategic good Fenjiu, callback is a good opportunity for layout. (1) in the past 5 years, Fen Liquor has been successful in 50 different products and two yuan products with a total price of 500 yuan. Baijiu is rare in the history of liquor development. Meanwhile, among the main products of sub high-end famous wines, Qing 30 is a rare variety that can double the rated price. These two events have confirmed the strong brand strength of Fenjiu. Looking forward to the future, it is worth looking forward to both the layout of the thousand yuan price belt and the health industry of Zhuye Qingda. (2) According to Weijiu news, at the Fenjiu global dealer conference, chairman yuan Qingmao said that Fenjiu should seize the victory and pursue the momentum in 2022. We believe that the new chairman of Fenjiu has excellent resume and experience, and the new team will soon complete the running in, continue the direction of reform and move forward quickly. (3) Affected by multiple factors such as the change of senior executives and the spread of the epidemic, Fenjiu has made a significant adjustment since December. We believe that the callback is a good opportunity for layout and continue to focus on recommending Fenjiu.
Valuation
According to the company’s performance forecast, we slightly adjusted the forecast. It is estimated that the EPS from 2021 to 2023 will be 4.42 yuan, 6.18 yuan and 8.11 yuan respectively, with a year-on-year increase of 75%, 40% and 31%, maintaining the buy rating.
Main risks of rating
Channel inventory exceeded expectations and market style switched.
