Affected by the intensification of competition in new business type, such as community group buying, and the decline in CPI compared with the same period last year, the company's 2021Q2~Q3 same-store sales are-7.4%, but improved month by month; the decline in passenger flow in traditional supermarkets is a long-term trend. In the face of new business type diversion, the company aims to: 1) increase the offline scene experience, so that consumers can find the reason to go to the store again; 2) optimize the online business model, and strive to increase the online business scale and net interest rate simultaneously.
Increased competition in the industry, insufficient consumption power of residents and downward CPI and other factors led to a year-on-year decline in revenue and profits during the reporting period. From 2021-4-1 to 2021-9-30, the company achieved operating income of 41.53 billion yuan,-5.0% compared with the same period last year, of which commodity sales income / rental income was 39.76 billion / 1.77 billion yuan, compared with the same period last year. 3.6%; net profit attributable to 120 million yuan,-86.0%; net cash flow of operating activities was 3.16 billion yuan,-40.2% year-on-year; comprehensive gross profit margin was-0.6pct to 26.3% year-on-year. 2021Q1-Q3, the company realized operating income of 70.38 billion yuan, year-on-year-6.5%, commodity sales income / rental income of 67.62 billion / 2.77 billion yuan, year-on-year-6.9% Universe 7.3%, and attributable net profit of 820 million yuan, year-on-year-63.2%.
The downward trend of the same store slowed down, and small and medium-sized super exhibition stores fell short of expectations. Same store: from 2021-4-1 to 2021-9-30, the company's same store sales were-7.4% (2021Q1) (9.2%), of which 2021Q3 same store sales were growing in low digits in July, and same store sales were basically flat in September. Exhibition shop: from 2021-4-1 to 2021-9-30, the company opened 39 new stores, including 3 hypermarkets and 36 small Runfa supermarkets, closed 2 stores, and the exhibition stores in small and medium-sized supermarkets were not as fast as expected. As of 2021-9-30, the company has a total of 565 stores, including 491 hypermarkets, 6 Zhongrun Fat and 68 small Runfa stores, 26 of which are under construction, 16 of which are under construction.
The development of multi-format and omni-channel has been promoted continuously. Industry format through the omni-directional layout of hypermarket + medium Runfa + small Runfa; channel through offline + online B2C + online B2B + community group purchase comprehensive exploration. Online B2C business: during the reporting period, online B2C business sales accounted for nearly 20%, and the average daily volume of the store was nearly 1400, with an estimated unit price of RMB 630.64. Online B2B business: due to the impact of community group buying, B2B business sales accounted for nearly 10% of sales during the reporting period. The company will adjust the customer structure and expect B2B business to return to the growth track in the next fiscal year. Community group buying:
The company will focus on BABA's supply chain, procurement system and shared warehouse network construction through cooperation with rookie post station and self-development group purchase of flying cattle group purchase (emphasis on quality and profit). No longer pursue scale growth.
Risk factors: consumption continues to be in the doldrums, the impact of diversified formats intensified, offline passenger flow recovery is poor, the cultivation and sales of small and medium-sized supermarkets are not as good as expected.
Investment suggestion: in the second half of the fiscal year, the company will adhere to the strategy of improving fresh supply chain capacity, improving user operation capacity and continuously exploring multi-format business models, and strive to resist the decline in performance brought about by intensified competition in the industry. Taking into account the impact of community group buying, fresh new business type and the negative impact of intensified competition in the industry, the company's annual operating income forecast for 2021-23 is lowered to 90.83 billion / 92.99 billion / 95.4 billion yuan (originally forecast is:
99.73 billion / 106.56 billion / 114.35 billion yuan), reduced the 2021-23 natural year vested net profit forecast to 1.11 billion / 1.2 billion / 1.33 billion yuan (the original forecast is: 2.71 billion / 2.78 billion / 3.10 billion yuan), corresponding to the 2021-23 EPS forecast is 0.12 PE 0.13 shock 0.14 yuan, combined with the industry comparable company valuation, give the company 2021 29x PE, corresponding to the target price of HK $4.10 billion Maintain the "overweight" rating.