Recently, the release of the "new national standard" of liquor has caused a huge wave in the wine industry.
As one of the brands under Shunxin Agriculture , whether Niulanshan will be affected has attracted much attention from investors.
. Under the shadow of the "new national standard" of liquor, the stock price of Shunxin Agricultural , which has become popular with the " Erguotou " series of liquors, has also weakened one after another. On July 23, the stock price of Shunxin Agriculture hit a new low since this round of adjustment, falling to 35 yuan, which was cut in half from the highest price of 77.64 yuan at the beginning of the year, becoming another scenic spot for liquor stocks this year.
" Shunxin Agriculture adheres to the business philosophy of 'brew wine for the people and brew good people' and is confident that it will continue to gain the recognition and trust of consumers." Shunxin Agriculture said in response to a Securities Times reporter.
As for whether the company will adjust its product structure in the future due to the "new national standard" of liquor, Shunxin Agriculture said that industry experts and management are currently organizing discussions and research, and the specific progress will be announced in the future.
The "new national standard" of liquor is about to be implemented
Recently, the National Standards Administration Commission issued the "2021 National Standard Announcement No. 7 of China", and the two national standards, GB/T 15109-2021 " Liquor Industry Terminology " and GB/T 17204-2021 "Beverage Wine Terminology and Classification", were officially released. The liquor industry has also ushered in new national standards, with the specific implementation date starting from June 1, 2022.
Among them, the biggest change is that the "white wine" has been classified in a specific way, and the entry threshold for "white wine" has also been added. The new standard clearly stipulates that liquor shall not directly or indirectly add color, aroma and flavor substances produced by non-fermentation. Solid-state liquor cannot add any alcohol and additives. Liquid-state liquor and solid-liquid-state liquor can add grain and cereal alcohol, but other raw alcohol and additives cannot be added.
This means that after the implementation of the new national standard, no matter whether it is solid-state liquor, liquid or solid-liquid liquor, color-shaped, fragrant and odor-shaped additives that are not fermented by themselves are allowed. If you are determined to use it, you can only sell it on the market in the name of mixing wine.
Industry insiders said that previously, liquor allowed the addition of additives that comply with the norms to make up for the shortcomings in taste and style, but this also led to the abuse of this "permit", and the market was filled with a lot of inferior liquor. After the implementation of the new national standard, it can standardize the liquor market to a certain extent and promote the sustainable and healthy development of the liquor industry.
Some products under Niulanshan may be affected
Shunxin Agriculture 's liquor industry has two major brands: Niulanshan and Ningcheng, and Niulanshan has five major series of products: classic Erguotou, traditional Erguotou, century-old Niulanshan, rare Niulanshan and aged Niulanshan; Ningcheng's main products are cotton-flavored Ningcheng Laojiao liquor.
Among them, Niulanshan mainly uses low-end wine, accounting for more than 70% of the liquor revenue, and is also the main source of profit for the liquor business of Shunxin Agricultural . According to the company's 2020 annual report, low-end wines are mainly aged and traditional Erguotou.
Securities Times reporter learned from the JD platform that Niulanshan aged liquor 42 degrees/500ml and 52 degrees/500ml are the best-selling products of Niulanshan JD self-operated flagship store. Among them, a box (12 bottles) with a 42-degree/500ml specification of Niulanshan aged wine costs 175 yuan, equivalent to about 14.59 yuan per bottle; a box (12 bottles) with a 52-degree/500ml specification of Niulanshan aged wine costs 185 yuan, equivalent to about 15.42 yuan per bottle, and the prices are relatively cheap.
It is worth mentioning that when observing the specific parameters of aged liquor, the reporter found that its best-selling aged liquor uses "edible spices" and does not meet the latest standards of liquor.
When the reporter was consulting the company's related matters, Shunxin Agriculture also revealed the relevant information to the reporter. The company believes that Niulanshan aging may be affected, but it is hard to estimate how big the impact will be.
In addition, the company's large vat of Erguotou also has "edible alcohol" and "edible spices".
According to the latest standards, no matter it is liquid liquor , solid liquor, or solid liquor, non-cereal alcohol and food additives shall be added. Any wine that is added with edible additives and seasoned with aroma cannot be called liquor, but must be called " prepared wine " or "scented wine".
"With the change of domestic social structure, the concept of liquor consumption has become more mature and gradually shifted to value consumption. Consumers pay more attention to 'whether it is worth it' rather than 'whether it is expensive'." Shunxin Agriculture said that Niulanshan has broad development space for folk wine oriented towards value pursuit, so it proposed the direction of building the first brand of folk wine in China. The introduction of the new national standards is like the impact of accidental events on stock prices, which may have negative impacts in the short term. However, in the long run, Niulanshan adheres to the business philosophy of "making wine for the people and making good wine for the people", and he is confident that he should continue to gain the recognition and trust of consumers.
Regarding whether the company will adjust its product structure, Shunxin Agriculture responded to a Securities Times reporter and said that industry experts and management are currently organizing discussions and research, and the specific progress will be announced in the future.
Niolanshan is focusing on the mid-to-high-end market
Niolanshan is a representative of the wine brand at the northern end of the Grand Canal. In recent years, it has been continuously focusing on the southern market through integration along the route.
According to Shunxin Agriculture 2020 annual report, the national marketing pattern has been formed, with sales revenue in foreign markets accounting for more than 80% of the total sales, sales in Beijing, Tianjin and Hebei have decreased, and sales in the Pearl River Delta market and e-commerce channels have increased against the trend.
At the same time, Niulanshan is also breaking through the mid-to-high-end market. It is understood that among the mid-to-mid wines, Niulanshan is represented by the "Treasures" series, and the high-end one is mainly represented by the classic Erguotou and the century-old Niulanshan series.
However, the company's sales of high-end wines in 2020 were not very optimistic, down 12.68% year-on-year from 2019. Guotai Junan believes that high-end products are expected to be mainly affected by the Beijing market, and mid-range treasures are still in the introduction period, and we look forward to subsequent efforts as resources are put into use.
It is worth noting that with the popularity of sauce wine since 2020, Niulanshan, which has always focused on light and strong-flavored liquor, is also trying sauce-flavored liquor .
Recently, in response to investors' questions, Shunxin Agriculture stated that in order to meet the consumption needs of the people in the new era for different fragrance products, Niulanshan has cooperated exploratory cooperation with regional big merchants to launch sauce-flavored liquor products in some regions to optimize the product structure of the regional market.
It is understood that this liquor product is the "Gifaner" sauce-flavored liquor launched by Niulanshan. It is currently only sold in Ward Mall. The Niulanshan JD official flagship store has not found this product.
Securities Times reporter found out from Ward Mall that the price of each bottle of "Gift Noodles" sauce-flavored liquor with a specification of 53 degrees/500ml is 498 yuan.
However, Ward Mall shows that the sales of this liquor are not very optimistic, and there are only 7 pieces at present. When a Securities Times reporter consulted about the company's related matters, the company said that this is the company's preliminary exploration of sauce-flavored liquor.
The company will divest its real estate business
In fact, in addition to the liquor business, Shunxin Agricultural also has pork business and real estate business, but pork stocks and real estate stocks have fallen one after another recently, which has also affected investors' sentiment to a certain extent.
According to Shunxin Agriculture 2020 annual report, the company's main business includes liquor, slaughtering, real estate, etc. Among them, liquor is the largest business, with revenue accounting for 65.66%, pork accounting for 27.14%, and real estate accounting for 3.4%.
However, in 2020, the company experienced an increase in revenue but not profit, with operating income increasing by 4.1% year-on-year, while net profit attributable to shareholders declined by 48.1% year-on-year.
Regarding the reasons for the decline in performance, the company once stated in the performance briefing, "The expansion of real estate business losses in 2020 is the main reason, and we are also accelerating the pace of sales and withdrawing from real estate business. In addition, people cannot go out for travel, cannot have dinner, etc., which also affects the consumption of Niulanshan Erguotou , which is positioned as the 'ministered wine' attribute."
Although the proportion of real estate business in the company's revenue is not high, it has a great impact on the company's performance.In 2020, the company's annual report showed that Shunxin Jiayu Real Estate Development Co., Ltd., a real estate company under Shunxin Agricultural , had 534 million yuan in 2020, while the company's net profit in 2020 was 420 million yuan.
The real estate business dragged down the company's performance, and the company also stated that it will resolutely withdraw from the real estate business. In response to investors' questions, the company said that divesting of real estate business is the company's established strategic goal and a key task that the company has unswervingly promoted. This year, foreign projects are expected to be cleared, and Beijing projects are also actively promoting deduction.
Pacific Securities analyst Huang Fusheng said that the improvement of the epidemic has promoted the recovery of liquor consumption and product structure, and part of the profits brought about by price increase is invested in the continuous push of product structure. In 2021, the company's liquor will show better growth quarter by quarter. The pig industry chain has fallen profits due to the decline in pig prices. Real estate projects from other places have gradually been cleared in the first half of the year, and conservative estimates have been conservatively reduced.
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