The Zhitong Finance App learned that Huacheng Securities released a research report saying that they are looking forward to the Mid-Autumn Festival and National Day peak season and prefer definitive leaders. Currently, repayments during the peak season are starting at an accelerated pace, and wine companies are making intensive efforts to promote repayment and sales. The peak season is expected to achieve a slight increase in volume, price stability, and squeezing growth. Prefer Kweichow Moutai (600519.SH), which has both performance certainty and prosperity (strong performance certainty, overall improvement in management governance), Shanxi Fenjiu (600809.SH) (marketing system is back on track, performance and fundamentals are still strong), Luzhou Laojiao (000568.SZ) (management and team are the most market-based, and performance flexibility is still sufficient);
Second, we recommend Wuliangye (000858.SZ) and Yanghe Co., Ltd. (002304.SZ), which all have strong fundamentals and high value for money valuations. It is recommended to continue to pay more attention; continue to recommend regional leaders such as Jinshiyuan (603369.SH) and Gujing Gongjiu (000596.SZ), and their steady management performance is highly certain.
Foreword:Following Zhejiang, Jiangsu, and Sichuan in the early stages, this report gives the following feedback on the Anhui market:
The main views of Huacheng Securities are as follows:
Overview of Huijiu: Major production and marketing provinces, the trend of upgrading and expansion continues, and the concentration of regional leaders is accelerating.Anhui Province has a strong drinking atmosphere. It is a major liquor producing and selling province. In '22, the province produced about 265,500 tons of liquor, ranking fifth in the country. Located in East China, it has strong economic growth momentum, with a GDP of 4.50 trillion yuan in '22, ranking 10th in the country. Economic development has led to consumption upgrades, superimposed by regional leaders. The mainstream price band for liquor in the province has gradually moved up to 200-300 yuan. Upgrading of mid-range liquor has become more obvious, competition among wine companies in the province has intensified, and concentration is increasing at an accelerated pace. Based on channel feedback, the characteristics of the Anhui liquor market are as follows:
Consumption upgrades are interpreted, and the market continues to expand.According to estimates, the market capacity of Huijiu increased from 20 billion yuan in 2015 to 38 billion yuan in '22, with a CAGR of about 10%. Currently, high-tech industries in the province are booming, and economic growth momentum is strong, which strongly supports consumer consumption upgrades. Various wine companies are also actively improving their product layout. The mainstream price band continues to upgrade. The Huijiu market is expected to expand to 50 billion dollars by 2025.
Competition barriers are deep, and alcohol savings are concentrated at an accelerated pace.There is a clear pattern of price bands within the province. High-end Maowu is the main, competition at the sub-high-end is fierce. Furui and Yingge continue to upgrade to seize the sub-high-end market share, while mid-range and low-end liquors are dominated by regional wine companies. The Anhui market has high channel barriers, showing a “one superpower, double strength” pattern. Currently, leading wine companies with large volumes, excellent brands, and strong channel control continue to sink and reduce the impact on small and medium-sized wine companies. Low-end production capacity in the province is gradually being cleared, and their share is concentrated on leading wine companies.
Mid-range and low-grade products are mainly low-grade, and strong aromas dominate the fragrance type.Sub-high-end liquors and above in the province are mainly high, low below 300 yuan, and have multiple catering channels and distribution for self-drinking. Consumers mostly prefer strong-flavored liquor. In recent years, liquor categories have evolved in diversification and specialization.
Mid-Autumn Festival News: Terminal stocking is active, manufacturers are increasing the number of banquets, demand for alcohol is diverse, and sales are expected to increase intensively near the pre-holiday season.Demand for souvenirs, banquets, and drinks for visiting family and friends during the double festival is diverse. Wine companies from inside and outside the province are also actively planning and increasing event incentives. In conjunction with channel research, the specific feedback is as follows:
Provincial brands: Repayment progress is generally good, channels are being flattened at an accelerated pace, and C-side marketing has been increased.First, popular banquets continue to boom, and mainstream wine companies are increasing their number of banquets. There was a year-on-year increase in double festival banquet bookings. Furui continued to raise the price band for banquets, Gu 16 maintained a high increase, and Kouzijiao and Welcome Car also introduced policy support such as buybacks and reverse incentives. Golden Seed Fuhe Incense continues to be cultivated, and banquets may be the core growth point for mid-autumn. Second, performance in terms of repayment, batch pricing, and inventory was relatively excellent, and the willingness of terminals to prepare goods increased month-on-month. The overall batch price and inventory performance of regional wine companies are relatively stable, and the repayment process is relatively fast. It is expected that the annual repayment will be completed before the Furui and Welcome Car Festival. The distribution of new products and series products from Kouzi has basically been completed. Although inventory has increased, shipments are better than last year. Third, channel reform is speeding up flattening, and costs are skewed towards the C side. Various wine companies continue to deepen channel reforms, improve control, optimize cost investment structures, and assist in terminal marketing.
Brands from outside the province: High-end Liquor Maogou has an absolute advantage. The sub-high-end is under pressure in the short term, and the differentiation is obvious.The high-end wine pattern in Anhui is stable, demand from Maotai and Wuliangye is relatively rigid, and the turnover rate is still fast. The performance of the remaining 1,000 yuan products, Guojiao, Qinghualang, and Junpinxijiu, was relatively weak. Sub-high-end demand is under phased pressure, brands outside of the province are clearly differentiated. Jiannanchun has benefited from the banquet boom, maintained a high turnover, good marketing feedback, accelerated release of Fenjiu brand potential, strong supervision and efficient cost delivery, the Blue and White series has a good marketing atmosphere, Yanghe is under pressure in the short term, the share of the sub-high-end market has declined, and the Mid-Autumn Festival National Day has increased policy, mainly to help channels digest inventory.
Risk warning:The recovery in terminal demand fell short of expectations, industry competition intensified, peak season performance fell short of expectations, etc.