Events:
The company released its 2019 performance KuaiBao. The company's operating income was 2.393 billion yuan, down 14.54% from the same period last year. The company realized a net profit of 153 million yuan belonging to shareholders of listed companies, an increase of 153.27% over the same period last year.
The company issues a pre-plan for the non-public offering of shares, and the total amount of funds to be raised by the company will not exceed 859.5603 million yuan (including capital), which will be used to supplement the working capital and two pig breeding projects.
The company issued a restricted stock incentive plan, which plans to grant a total of 154people, and the number of restricted shares to be granted is 13.549932 million shares. The conditions for the unlocking of the 2022 restricted stock in 2020Universe 2021 are as follows: based on the number of live pigs sold in 2019, the growth rate of sales volume is not less than 100%, 250%, and 500%, respectively.
1. Benefiting from the rise in pig prices, the company's performance has substantially turned losses into profits.
In 2019, benefiting from the rise in pig prices, the company's breeding business made a substantial turnaround. According to wind data, the average price of live pigs in 2019 was about 22.27 yuan / kg, up 77.03 percent from the same period last year.
In 2019, the company's aquaculture business income was 731 million yuan, and the net profit of the breeding business was 66 million yuan, an increase of 190 million yuan over the previous year, and a loss of 124 million yuan last year. Thus it can be seen that the company's performance increment mainly comes from the aquaculture business, which has become the core of profit growth. Combined with the expert point of view, we judge that it will take a long time for the development and marketing of non-plague vaccine. It is expected that in the next 2-3 years, domestic pig production capacity will be difficult to return to the previous normal level. Affected by this, domestic pig prices are expected to continue to operate at a high level, and the profits of the company's breeding business will remain at a high level.
2. Encourage landing to inject nuclear power into the development of aquaculture business.
Aquaculture is a labor-intensive industry, and the core of development lies in people. The company launched a restricted stock incentive plan, covering a wide range of objects and low exercise price, which can be said to inject nuclear power into the development of aquaculture business. In order to meet the unlocking conditions corresponding to the restricted stock incentive plan, the number of pigs produced by the company in 2020, 2021 and 2022 should not be less than 800000 / 1.39 million / 2.38 million, with an average annual compound growth rate of 81.8 per cent. The production capacity construction and launch of many pig breeding bases such as the northeast of the company have made rapid progress. Combined with this incentive landing, we judge that there is a great possibility to achieve the goal of hurdling in the next three years, so it is very flexible.
Profit Forecast:
It is estimated that the company will produce 800000 / 1.5 million pigs in 2021, and the average pig sales price will be 28x19 yuan / kg respectively, then the net profit will be 807 million / 900 million respectively, corresponding to EPS 1.43 PE (total share capital is the total share capital after non-public offering), giving 8 times PE, target price 11.44 yuan, giving buy rating.
Risk Tips:
1. Sudden major epidemic risk: large-scale diseases such as African classical swine fever or bird flu will occur in the process of livestock breeding, resulting in livestock death, and have a greater negative impact on the consumer psychology of the general public, resulting in shrinking market demand, thus affecting the profitability of the industry and related enterprises.
two。 The price is lower than the expected risk: the price of livestock and meat falls sharply or rises by less than the cost, which affects the profitability of the industry and related companies, and there is a risk that it is difficult to sustain growth or even decline in future performance.
3. Raw material price fluctuation risk: the output and price of the main raw materials and agricultural products used in the company's production and operation are greatly affected by uncontrollable factors such as weather and market conditions. If the prices of major raw materials fluctuate sharply in the future, it will affect the profitability of the industry and related companies.
4. The listing of non-plague vaccine: the listing of effective non-plague vaccine will fundamentally block the spread of non-plague epidemic, the progress of capacity removal will be affected, and the increase of pig price may not meet expectations.
5. After the outbreak of COVID-19 epidemic, the opening time and operating rate of the slaughterhouse were lower than expected, the pig price was greatly affected, and the consumption was lower than expected.