This report is read as follows:
We believe that the company implements the development strategy of flying together in the five industries and constantly optimizes the level of production capacity, which is expected to achieve sustainable profits in many sectors such as live poultry, pigs and so on.
Main points of investment:
Maintain the "overweight" rating. We maintain the company's 2022-2024 EPS estimate of 1.31,2.12,2.28 yuan, and maintain the company's target price of 56.34 yuan.
Event: the company announced that 4.0199 million live birds were sold in October 2022, with a sales income of 114.8567 million yuan and an average sales price of 15.24 yuan / kg, with month-on-month changes of 1.28%, 1.10% and-3.92%, respectively. year-on-year changes were 6.00%, 42.14% and 29.57%, respectively.
The uplink cycle is strong and the industry concentration is improved. Supply side: affected by trading losses during the epidemic, the industry opened the pace of capacity removal for two years, capacity contraction has been transmitted from ancestral breeder chickens to commodity generation broilers, the upstream supply side pressure reduced to open the supply gap, stimulate prices to rise, ushered in the performance inflection point. Demand side: consumers' preference for poultry is expanded, promote enterprises to move downstream, enhance the added value through deeply processed products, and stimulate consumer demand. We believe that prices are expected to remain high for a long time. In addition, affected by feed shortage, persistent drought, cold winter and other factors, the willingness of bulk farmers to fill the fence is negative, so it is difficult to consolidate the existing breeding scale and sell the market space.
The head enterprises will expand their production capacity, improve their own scale and technical level, and increase the concentration of industry capacity.
The company's multi-business expansion, the layout of industrial clusters. Xiangjia shares is committed to building a green circular economy industrial chain of 100 million meat birds, 10 million egg birds, 1 million live pigs, 500000 tons of organic fertilizer and 100000 tons of Shimen citrus within five years. The completion of Tianxinyan Pig breeding Farm marks the formal construction of the whole industry chain of millions of live pigs in cooperation with Wuzhou Hengtong organic brands to promote the production standardization of chilled chicken products and expand the development advantages of enterprises.
Risk tips: epidemic risk, raw material price fluctuations, the company's scale expansion is not up to expectations.