Main points of investment:
The company is the leader of high-quality animal protein innovative food under Lenovo Holdings.
The company is mainly engaged in the trade, processing and sales of medium-and high-grade seafood such as salmon, which is the target of A-share salmon scarcity. The company has 95 farming licenses in Chile and produces about 100000 tons of salmon annually in 2020, ranking sixth in the world. 2021H1's operating income was 2.227 billion yuan, an increase of 9.17% over the same period last year, while its net loss was 136 million yuan, a decrease of 47.50% over the same period last year.
Salmon industry supply and demand tight balance, the market space is far more than 100 billion, Nuggets high growth track.
From the supply side, salmon culture is subject to license restrictions, the future growth rate of the supply side is expected to be only 4%, capacity expansion is limited. And the industry is highly concentrated and moderate, with CR10 in Norway and Chile reaching 68% and 87% respectively in 2020.
On the demand side, the demand for salmon recovered rapidly after the epidemic. The salmon price index in June was nearly 7 euros / kg. According to the sales volume of 2.5 million tons in 2020, global salmon sales exceeded 100 billion. The Chinese market has become a new growth point, and driven by domestic growth, global consumption is expected to grow by more than 7% in the next decade.
Precision card position of Chinese consumption upgrading, is expected to copy the successful model of large fruit products.
In August 2020, the company officially launched the "Jiawo Xiansheng" brand for C-end, and in 2021, launched the high-nutrition children's food brand "Chanxiong classmate". Jiawo Group has successful brand operation experience in large fruit products. Xinrong Mao, a leading global fruit enterprise in China, has successfully created Jiawo blueberries, Jiawo durian and other individual products, and the company is expected to learn from its successful model.
Raise funds to build a processing plant in 12 districts, which will further reduce costs and increase efficiency after completion.
Zone 12 has excellent natural endowment and huge capacity potential, but the infrastructure is insufficient, there is a lack of large-scale processing plants in the region, and the transportation cost is high. The company issued a fixed increase plan in May 2021, which intends to invest 170 million of the funds raised in the 12-district processing plant and other projects. this project is the first large-scale processing plant in the region, with a salmon processing capacity of 72000 tons per year. After the construction is completed, it will further reduce the cost and increase efficiency.
Profit forecast and rating
We estimate that the operating income of the company from 2021 to 2023 is 54.59 and 65.70 / 8.209 billion yuan respectively, and the net profit of return to the mother is 0.01 and 122 million respectively. The net profit of the company is 277 million yuan, EBITDA is 777.096 million yuan, and EV/EBITDA is 17.23x/12.51x/8.86x. Considering the two methods of EV/EBITDA and PE, and referring to the average valuation level of the comparable company for 23 years, the company's target price is 34.9 yuan, giving a "buy" rating for the first time.
Risk hint
Natural disaster risk; exchange rate fluctuation risk; food safety risk
