Core point of view
Channel research Zhou Zhouxian: Mid-Autumn Festival stocking has begun, and high-end prices remain stable. The wholesale price of Moutai loose bottles Feitian is 2,800 yuan, a decrease of 10 yuan on a week-on-year basis. The wholesale price of Feitian for the whole box is 3,210 yuan, which remains unchanged, and the inventory is about 1 week. The wholesale price of Wuliangye is 975 yuan, which is the same as the previous week, and the inventory is about one month. The wholesale price of Guojiao is 920 yuan, which is the same as the previous week.
Core company tracking: The Mid-Autumn Festival for liquor has kicked off, and popular products have benefited from a low base
- Jiangsu liquor business exchanges: Distilleries have taken active actions, and dealers have basically completed the Mid-Autumn Festival distribution. channel survey feedback shows that Moutai is 75% progress and the inventory is less than one month; Wuliangye is 80% progress and the inventory is about 1 month. The progress of Yanghe and Jinshiyuan is both 80%, and the inventory is about 1 month.
- Sheshe Wine Industry : The worst time has passed, and we are optimistic about the long-term development. Q2 revenue was 1.14 billion, -16.3% year-on-year; net profit attributable to the parent company was 300 million, -29.7% year-on-year. The worst has passed, and we are optimistic about long-term development.
- China Resources Beer : Profit performance exceeded expectations, and the valuation performance-price ratio is outstanding. The company's profit performance in the first half of the year exceeded expectations, and it is expected to accelerate its sales target in the second half of the year. The medium- and long-term channel sinking has begun to enter the harvest period, and the logical deduction of high-end products has stronger certainty.
- Chongqing Beer Interim Report Performance Exchange: There is still room for high-endization, and the recovery is accelerating month-on-month. Q2 revenue was in line with expectations. The company will accelerate its big city plans in the second half of the year and the expense rate will remain relatively stable.
- Zhongju High-tech : Delicious fresh performance exceeded expectations, H2 focuses on marginal improvements. 22 Q2 Delicious Fresh revenue growth exceeded expectations. Looking forward to the second half of the year, the report will still have a low base, channel inventory will be healthy, actual sales will gradually recover, and cost pressure is expected to continue to ease.
- Qiaqia Food : Costs drag down profits, cash flow performs well. The company's revenue growth in the second quarter is in line with expectations. The company has proactively controlled goods in June and has spare capacity. The channel inventory is healthy and the double holiday season is approaching. In the second half of the year, revenue growth is expected to be under little pressure. Channel feedback indicates that H2 has a price increase, and it is recommended to pay attention to the opportunity of oversold .
- Dongpeng Beverage : Expansion outside the province is impressive, and profit elasticity exceeds expectations. Q2 The company bucked the trend and experienced high growth in the market outside the province due to the disruption of the epidemic. Looking forward to the whole year, the margin of disruption from the epidemic has weakened, the rising cost trend has been suspended, and sales may accelerate month-on-month due to hot sales during the peak season.
Investment advice: Pay attention to the expected difference and seize oversold opportunities. Liquor sector:
Risk warning: The epidemic has affected demand, rising costs, and intensified competition.
Report text
1. Channel Research Zhouzhouxian: Mid-Autumn Festival stocking has begun, and high-end prices remain stable
Maotai: The wholesale price of loose bottles is 2,800 yuan, a decrease of 10 yuan on a weekly basis. The wholesale price of the whole box of Feitian is 3,210 yuan, and the price remains unchanged. The inventory is about one week.
Wuliangye: has a wholesale price of 965-975 yuan, which is stable week-on-year, and the inventory is about 1 month.
Luzhou Laojiao : Guojiao has a wholesale price of 920 yuan, which is the same as the previous week.
2. Tracking of core companies: The Mid-Autumn Festival for liquor has begun, and popular products have benefited from a low base
Jiangsu Baijiu Business Exchange: Distilleries have taken active actions, and dealers have basically completed the Mid-Autumn Festival distribution. In terms of high-end liquor, Moutai’s current inventory is less than one month, and the task progress is 75%; Wuliangye’s task progress is 80%, and the inventory is about one month. The current task progress of Yanghe and Jinshiyuan is 80%, and the inventory is just over a month old. The dealer's Gujing mission target this year is 30%-40%, with a growth rate of 20% from January to July. The current inventory is good, and whether it can be completed depends on the Mid-Autumn Festival digestion. Yanghe’s digital red envelope this year has enabled dealers to avoid spending on promotional expenses, thus increasing dealer and terminal profit margins in disguise. Last year, the Meng 6+ code scanning bottle opening rate reached 70%, which means that the company's digitalization has been fully implemented on the consumer side, and will cover all categories this year. In terms of Mid-Autumn Festival policy, Gujing has increased its additional investment in Jiangsu. The investment in local Jiangsu wine is basically limited to a small amount of additional investment in the banquet channel.
Sheshan Wine Industry: The worst has passed, and we are optimistic about long-term development. company released its 2022 semi-annual report. In the first half of the year, the company achieved operating income of 3.03 billion yuan, +26.5% year-on-year; net profit attributable to the parent company was 840 million yuan, +13.6% year-on-year; and advanced accounts received were 430 million yuan, +17.0% year-on-year. Among them, Q2 achieved revenue of 1.14 billion, -16.3% year-on-year; net profit attributable to the parent company was 300 million, -29.7% year-on-year. Taking into account the company's active expense investment policy in the first half of the year, EPS is expected to be 4.74, 6.54 and 8.83 yuan in 22-24, corresponding to 25X in 23, maintaining the "strongly recommended" rating.
Zhongju High-tech: The performance of Yuexianxian exceeds expectations, and H2 focuses on marginal improvements. 22 Q2 Delicious Fresh’s revenue growth exceeded expectations, mainly due to the company’s improved marketing on a low base, increased channel enthusiasm, and the contribution of superimposed inventory replenishment. On the profit side, cost pressure is still high, but the decline in gross profit margin narrowed month-on-month, and the decline in expense ratio and tax rate contributed to profit elasticity. Looking forward to the second half of the year, the report will still have a low base, channel inventory will be healthy, actual sales will gradually recover, and cost pressure is expected to continue to ease. In addition, the company's internal management and governance improvements this year are expected to be catalytic. The EPS forecast for 2022-23 is expected to be 0.85 and 1.08, with a PE of 40 times in 23 and a market value of 3 billion for the real estate business, corresponding to a target market value of 37 billion yuan and a target price of 47 yuan, maintaining a "strongly recommended" rating.
Dongpeng Beverage: Expansion outside the province is impressive, and profit elasticity exceeds expectations. company achieved revenue/net profit of +15.9%/+22.8% year-on-year in 22Q2, and its profit exceeded previous expectations. In Q2, the company bucked the trend and experienced high growth in the market outside the province due to the disruption of the epidemic. Looking forward to the whole year, the margin of disruption from the epidemic has weakened, the rising cost trend has been suspended, and sales may accelerate month-on-month due to hot sales during the peak season. In the medium and long term, the category attributes of the energy drink industry are better and the brand stickiness is stronger. Dongpeng has gradually captured the minds of consumers through continuous marketing and promotion, and the road to nationalization has become increasingly solid. EPS is expected to be 3.29, 4.59, and 5.96 in 22-24. The current company's stock price corresponds to 47/34xPE in 22/23 respectively, maintaining the "strongly recommended" investment rating.
Qiaqia Food: Costs drag down profits, and cash flow performance is outstanding. The company's revenue growth in the second quarter was in line with expectations, and its cash flow grew significantly. The profit side was dragged down by other products and overseas and e-commerce channels. The gross profit margin fell more than expected in the second quarter. Looking forward to the second half of the year, the company has sufficient capacity to proactively control goods in June. Channel inventory is healthy and the double festival peak season is approaching. It is expected that there will be little pressure on revenue growth. Faced with cost pressure, the company has successively raised prices for small categories and overseas markets. Gross profit margin in subsequent quarters It is expected to gradually improve. Considering that the cost pressure this year exceeds expectations, the EPS in 22-23 is expected to be 2.03 and 2.41 yuan. The current stock price corresponds to the 20X PE in 23, and the target price is 60 yuan, which corresponds to the 25X PE in 23. The "strongly recommended" rating is maintained.
China Resources Beer: Profit performance exceeded expectations, and valuation performance-price ratio is outstanding. company released its mid-term report, achieving revenue/core net profit of +7%/+20% year-on-year in 22H1, exceeding market expectations. Although the current epidemic is still breaking out at scattered points, scene restrictions and interference have improved month-on-month, coupled with factors such as hot weather and low base, the company is expected to achieve accelerated catch-up of its sales target in the second half of the year. In the medium and long term, the company's previous brand cultivation and channel sinking of Heineken has begun to enter the harvest period. With the support of a strong share base and channel control, the high-end logical deduction has greater certainty. The current stock price of the company corresponds to 30xPE in 23 years, which is relatively low within the sector. The valuation and price-performance ratio are outstanding. It is recommended to increase the layout. The company's EPS in 22-23 is expected to be 0.59 and 0.69, corresponding to PE 24X and 20X in 22-23, and the "strongly recommended" rating is maintained.
Chongqing Beer interim report performance exchange: There is still room for high-endization, and the recovery is accelerating month-on-month. Q2 Due to the impact of the epidemic, Wusu and 1664 saw single-digit growth. Brands such as Chongqing and Tuborg still had good growth in some regions. Such results under the impact of the epidemic are in line with expectations. In the second half of the year and in the future, the company will continue to accelerate its big city plans, with the expense rate remaining relatively stable. The company will focus on areas where it has a solid foundation and adjust its investment in a timely manner based on external factors. At the same time, the company will also make good use of off-site and online channels to cultivate. More consumer groups. Although there is still pressure on costs, the company has already prepared for the worst, and any improvement in trends in the second half of the year will be good for the company. Although there is a certain pressure on the current economy, high-end beer is still at an acceptable price. Instead, it can be used as a small reward to relieve pressure. Compared with mature market companies, there is still more room for high-end development. At present, as the impact of the epidemic gradually weakens and channel adjustments are coming to an end, market sales are also accelerating their recovery from July to August.
3. Investment strategy: Pay attention to the expected difference and seize the oversold opportunity
Continue to be optimistic about the recovery track and recommend liquor and beer. We believe that from the perspective of half a year or even next year, there is still no problem with the main line direction of recovery. Although there will be repetitions and interference on the slope, there is still no problem with the direction. We continue to be optimistic about the recovery track. We believe that the epidemic rhythm affects the recovery slope but not the recovery direction, and we focus on the liquor and beer sectors. The early market decline was due to macro differences, while the micro recovery and data verification were precisely the differences in expectations.
Investment advice: Pay attention to the expected difference and seize oversold opportunities.
Liquor section: 1) In August, we will focus on recommending Gujing, Yanghe, Laojiao and Laobaigan which have catalysts for mid-term results; 2) times The high-end mid-term report is a performance low point. In the second half of the year, we will accelerate our attention to Fenjiu and Shede; 3) Grasp the catalysis of liquidity to Maotai and Wuliangye.
Food sector: 1) Recommend Zhongju and Angel which improved significantly in Q2-Q3; 2) Continue to recommend the beer sector, hot weather + recovery of lower-tier cities + last year A low base constitutes a short-term catalyst, and the key targets are recommended China Resources and Qingdao ; 3) Strengthen the recommendation of low-valued, oversold stocks such as Qiaqia.
Risk warning: The epidemic has repeatedly affected demand decline, rising costs, intensified competition, etc.
4. Valuation table of key industry companies
Reference report
2, "Food and Beverage Industry Weekly Report (2022.0) 8.07): High-end enjoys recovery, and the public benefits from a low base" 2022-08-08
3, "Food and Beverage Industry Weekly Report (2022.07.31) - The sentiment has bottomed out and the callback is sufficient, and we continue to be optimistic about the recovery track" 2022-08-01
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