Report guide
Shengxun cloud merchants cut into the live e-commerce track with food as a breakthrough, deeply bound Simba, and changed their fundamentals significantly, upgrading their rating to "buy".
Main points of investment
Snack food x live e-commerce: the collision of two trillion markets, Simba and Sheng Xunda entered the high-prosperity track: live e-commerce is still in a period of rapid development. As of mid-October, Kuaishou Technology's 2020 GMV has exceeded 200 billion yuan. Snack food is also a fast-growing consumer segment track with a market size of more than one trillion. Food has become the largest category of Kuaishou Technology live e-commerce, accounting for more than 20%. The deep cooperation between the company and the Simba team is based on a huge blue ocean market.
Deeply bind the Simba team through equity incentives, which will be more interesting in the future: the short video live platform represented by Kuaishou Technology & Douyin is still collecting new traffic, and live e-commerce, as the main battlefield for realizing the short video live platform, still has great potential for development. Simba family as the largest family of Kuaishou Technology, its core competitiveness is reflected in: 1) massive traffic precipitation; 2) systematic e-commerce to cultivate anchors and operational capabilities; 3) efficient supply chain organization ability. Simba family live e-commerce GMV is already very large and is still growing rapidly, and food is also the top three category of Simba family GMV. After the core members of the Simba family joined Shengxun Cloud Merchants, through restricted equity incentives, the company encouraged the equity share to reach 9% of the total equity and unlocked it in three years. The corresponding unlocking performance indicators are that the net profit of Shengxun Cloud Merchants in 2020-2022 is not less than 0.2G / 2200,000 yuan. In the future, the company does not rule out taking a more diversified approach to deepen cooperation with the Simba family.
Profit forecast and valuation: live e-commerce is a growing track with long-term industrial dividends. Shengxunda works with the Simba family, a leading player in the industry, to take food as a breakthrough to share industry dividends, making it more interesting in the future. Considering the stock, structure and growth of Simba family's existing live e-commerce business, we believe that the fundamentals of Shengxinda, which is deeply bound to Simba family through equity, have changed significantly, with both certainty and growth. It is expected that the company's revenue will grow by 63% in 2020-2022, by 183% in 2005-2022, to 3.5pm-9.9pm-1.19m respectively, and its homing net profit in 2020-2022 will be 1.1pm-170pm, corresponding to PE42X/27X/25X, which will be upgraded to "buy".
Risk hint: the development of live e-commerce industry is not as expected, the competition is intensified, and the progress of cooperation is not as expected.
