The normal temperature lactobacillus beverage industry continues to increase, and the regional seasonality is obvious. The scale of China's room temperature lactobacillus beverage industry reached 14.88 billion yuan in 2015, and the CAGR in 2019-19 was as high as 17.8%. The industry has risen in the past five years, and we think it is expected to maintain an annualized growth rate of 7% in the future. At present, the market is mainly concentrated in second-and third-tier cities, the brand pattern is scattered, and the peak sales season is near summer and Spring Festival.
The revenue grows steadily, the product pushes through the old and brings forth the new. In 2011, the company took the lead in entering the room temperature lactic acid bacteria beverage industry.
In 2017, revenue was 1.246 billion yuan, CAGR was 4.3% in 2019-19, and the current market share is 15.1%. The decline in revenue in 19 years is mainly due to increased sales discounts and the occupation of sales channels by new products. The company dug the normal temperature lactobacillus beverage race track, the main products bottled "taste power" accounted for 90% of the income, the gross profit margin continued to rise. The company continues to innovate and launched five new products one after another in 2017-19 to alleviate the risk of a single product.
The first investment raised for production expansion and brand upgrading is expected to accelerate the development of the company. Due to the lack of production capacity of the company at present, part of it is supplemented by contract factories. The company raised 819 million yuan to build two new production lines with an annual output of 100000 tons of room temperature fermented lactobacillus beverage, and the gross profit margin is expected to further increase under the scale effect. At the same time, invest 380 million yuan to upgrade the brand.
Focus on channel construction, publicity and promotion expense rate is relatively high. The company focuses on distribution, accounting for more than 99.5% of sales in 2017-19. By the end of 2019, the company has developed 1306 dealers of "taste power" lactic acid bacteria drinks, covering 30 provinces and cities. 19H2 added new e-commerce channels to sell on online sales platforms such as Tmall and JD.com. The overall advertising promotion expense rate is relatively high, reaching 14.1% in 19 years.
Investment suggestion: we estimate that the operating income of the company in 2020-22 is 10.02, 11.06 / 1.295 billion yuan, respectively, compared with the same period last year, 19.6%, 10.5%, 17.1%, respectively, and the net profit of returning home is 2.43, 2.74, 315 million yuan, respectively, compared with the same period last year. 17.6 percent, 12.4 percent, 15.1, and 15.1 percent, respectively. According to the comparable company valuation method, the company is given a "neutral" rating of 25-30 times Pmax E in 2021, corresponding to a reasonable value range of 15.90-19.09 yuan.
Risk tips: food safety risks, fierce market competition, fluctuations in raw material prices, the risk of re-outbreak of the epidemic.
