Black sesame paste is the absolute leader in the field, and the fourth-quarter performance is expected to exceed expectations. The company's main product "Southern Black Sesame paste" brand has accumulated for nearly 30 years, is the leader of the black sesame paste market segment, with a market share of more than 30%. In the third quarter of this year, the company's revenue increased by 38.84% compared with the same period last year, and the return net profit increased by 29.03% compared with the same period last year. The performance inflection point is significant. In the fourth quarter, the company's revenue and profits are expected to achieve higher growth in the traditional peak sales season. From black sesame paste to big health food, the company has started a second venture. The plant protein light fat drink black milk officially launched by the company at the end of last year is mainly aimed at young white-collar workers. It is only listed in a few provinces such as Guangdong and Fujian this year. At present, it is selling well, and it will be listed in more provinces next year. In view of the fact that there are many competitors at the same price, it is recommended to track its sales. In terms of marketing, the company actively changed its marketing strategy by naming Jiangsu Satellite TV and other provincial satellite TV variety shows to provide marketing support for new products.
The equity incentive is deeply bound to the core team, the unlocking condition is higher, and the epitaxial M & A can be expected. The company implemented the equity incentive program in March 2015, deeply binding the company's core executives, regional middle managers and the backbone of the company. In 2016, the unlocking condition was that the non-net profit was not less than 250 million yuan; and food revenue increased by no less than 69% compared with 2014. 120%. After the termination of major asset restructuring in March this year, the company's performance next year is under great pressure, and epitaxial mergers and acquisitions are expected to accelerate.
Profit forecast: the company's performance elasticity next year is mainly reflected in the promotion of new products such as black milk and extension mergers and acquisitions. It is estimated that the company's annual net profit in 2016-17-18 will be 1.45 billion yuan 1.87 billion (excluding extension mergers and acquisitions), corresponding to 0.23 EPS 0.29 PE 0.34 yuan, corresponding to the current stock price of 7.91 yuan PE is 34-27-23 times. Cover for the first time and give an overweight rating.
In October 2014, the non-public offering resumption price subscribed by major shareholders was 7.12 yuan per share, with a lock-up period of 3 years, and the cost of holding shares was higher taking into account the time factor. It was first covered and rated as "holding increase", with a target price of 10.00 yuan.
Risk hints: epitaxial mergers and acquisitions fall short of expectations, and the progress of new product promotion is slow (there are certain risks in the diversification of food enterprises. It is recommended to pay attention to the shelving progress and sales of new products such as black milk in various provinces)