Events:

The company issued a semi-annual performance forecast for 2022: the net loss attributed to shareholders of listed companies is expected to be 600-700 million yuan in 2022, compared with a net loss of 163 million yuan in the same period last year, deducting a non-net loss of 5.5-670 million yuan, and a net loss of 179 million yuan in the same period last year.

Comments:

The company's Q2 loss has narrowed and is expected to turn a loss into a profit for the whole year.

Pig prices are generally low in the first half of 2022, the number of pigs produced by the company has increased significantly compared with the same period last year, the company has suffered a large loss, but the range of loss has been narrowed. 2022Q2 estimates that the real Q is now reduced by a net loss of 100 million yuan. 5-the price of 3.5 billion pig yuan has entered the upward period, rising to 23 yuan / KG on July 14. In 2022, the company aims to produce 5.5 million columns, an increase of 70 per cent over the previous year.

Feed business has grown rapidly and has developed into a large domestic feed enterprise group.

The company started in the feed business, the current feed products include pig feed, poultry feed, aquatic feed, ruminant and other categories, the company's feed production capacity of about 7 million tons. In 2019, the company chose the opportunity to expand the sales of poultry and aquatic materials under the background of non-plague, and the sales volume increased rapidly. At present, the company's poultry business has begun to take shape, gross profit margin has significantly reversed, the company's feed sector is expected to provide new momentum for performance growth in the future.

Earnings forecast, valuation and rating

We expect the company for 2022-24 We forecast the company for 2022-24 we expect the company's revenue from 2022 to 2024 to be 258.73lash 362.13 / 45.669 billion respectively, an increase of 43.43% over the same period last year, 39.97% year on year / 124.2264% over the same period last year; the net profit of homecoming is / 567.38% and 123.97% respectively. EPS is 0.45amp 3.03Compay 0.73 yuan per share, corresponding to PE is 56x/8x/-35x. In view of the company's outstanding provenance and management advantages and accelerated production expansion at the bottom of the cycle, as pig prices enter the upstream channel, the company's profitability is expected to improve significantly and maintain the "overweight" rating.

Risk hint

Risk of swine price fluctuation; risk of animal disease