The state encourages the further development of the wine industry

According to the national plan, by 2015, wine production will reach 2.2 million litres, an increase of 100% over 2010, with an average annual increase of 15%, and sales revenue will reach 60 billion yuan, an increase of 85%, with an average annual growth rate of 13%.

Profits and taxes totaled 12 billion yuan, up 88 percent, with an average annual growth rate of 13 percent. The proportion of wine production in the western region has increased to 20% of the country. The per capita domestic consumption of 0.6 litres is 25% of the consumption in Japan and less than 10% of the consumption in the United States, which is far lower than the global average consumption, and there is still more room for growth in the future.

The company releases its production capacity in the next few years.

In August 2011, Mogao International Winery completed a new production capacity of 15,000 liters, and the company's total production capacity reached 30,000 liters. The company's 12th five-year Plan will build 30,000 liter wine castles by 2015, with a total production capacity of 60,000 litres by 2015. If the layout of 1000 stores is completed by 2015, all 30,000 liters of 70% production capacity will be released, and annual sales will increase by 37%. As of October 2012, the company's wine grape planting base area is still 10,000 mu. The company's 12th five-year Plan will build 10,000 mu by 2015 and cooperate with farmers in 80,000-90,000 mu.

In 2009, the company proposed to build 1000 dealers and 1000 specialty stores by 2015 to achieve a sales income of 1 million yuan for each store, and mainly to train dealers outside the province, and mainly self-owned stores in the province. at present, we plan to add 30, 000 liters of wine castle production capacity and still rely on 1000 stores for sales. At present, the company has set up 38 marketing branches, more than 300 stores and more than 600 dealers throughout the country.

Performance forecast and valuation

We expect results to grow by 21.61%, 93.13% and 76.09% respectively from 2012 to 2014, with earnings per share of 0.18,0.35 and 0.61 yuan, respectively. In view of the fact that the company's share price is too high and has not been effectively supported by its performance, it has been given a "reduction" rating in 2012.

Risk hint

The company's production capacity was not released on schedule, and the construction of its stores and dealers fell short of expectations.

The economic downturn has led to a recession in the wine industry, which in turn has affected the company's sales performance.