The Zhitong Finance App learned that Tianfeng Securities released a research report saying that in the context of the industry's “price for volume” seizing market share, the market is concerned that in the context of the industry's “price for volume” seizing market share, the Mid-Autumn Festival National Day wine companies' repayment & sales performance will not be good, thereby affecting price/inventory stability, which in turn affects the market's profit forecast for wine companies in '24. The bank believes that the payout side of the liquor industry performed well during the Mid-Autumn Festival of the 23rd National Day. At the same time, actual sales performance is expected to be good, and the inventory side performance of strong alpha liquor companies is expected to improve. Considering that: 1) Mid-Autumn Festival National Day sales/inventory/batch performance; 2) poor performance expectations in 23Q3; 3) changes in domestic and foreign policies & economic expectations are the core catalysts for the current sector, we are optimistic about sector investment opportunities where the trend of industry consumption upgrading is irreversible.
Tianfeng Securities's main views are as follows:
Mid-Autumn National Day outlook on 23: repayments are stable, or savings may exceed expectations
Market concerns: In the context of the industry's “price for volume” seizing market share, Mid-Autumn Festival National Day wine companies' repayment & sales performance was poor, thereby affecting price/inventory stability, which in turn affected the market's profit forecast for wine companies in '24.
The bank believes that the payout side of the liquor industry performed well during the Mid-Autumn Festival of the 23rd National Day. At the same time, the actual sales performance is expected to be good, and the inventory side performance of strong alpha liquor companies is expected to improve:
1) The performance of the liquor payout side during the Mid-Autumn National Day on the 23rd showed the three characteristics of “multiple policies, speed of grabbing, and strong stability.” Under squeezed competition, wine companies generally guarantee repayment progress through methods such as strengthening C-side marketing/increasing repayment policies/advancing repayment timelines. Currently, major wine companies are making smooth repayments.
2) The marketing side has the three characteristics of “large regional differences, strong high-end popularity, and overall stable marketing”. The growth rate of regional marketing sales during the Mid-Autumn Festival on the 23rd was influenced by the 22-year base, but high-end & popular price range products still showed strong sales performance, and the bank expects overall sales to be good.
3) The performance side has the three characteristics of “significant increase in volume, no change in goals, and strong stability”. The bank believes that the volume and price driving performance of wine companies in 23Q3 may continue at 23H1. At the same time, considering the smooth repayment and the fact that the liquor company's performance targets have not changed, the rate of achievement of the company's annual performance target is high.
4) The wholesale price is an apparent expression of brand power, and the stability performance of the Mid-Autumn Festival National Day batch price may be good. Since 23 years, many high-quality wine companies have maintained and raised their price lists through methods such as direct price increase/indirect price increase/phased volume control/reduction in channel-side policies. Currently, the price market of major wine companies has remained stable. Currently, the price markets of major wine companies have remained stable, and it is recommended to rationally view potential post-holiday price fluctuations. Also, considering that Wuliangye's actual terminal sales performance is still strong, it is expected that Wuliangye's batch price, which is the benchmark price, will be stable.
5) “Inventory” is a comprehensive observation index for wine companies α during the Mid-Autumn Festival National Day. We are optimistic about the subsequent performance of low-inventory wine companies. Generally, Q3 wine companies' annual revenue accounts for about 20-25%. Inventory after the Mid-Autumn Festival and National Day reflects actual sales, and “inventory” is a comprehensive observation indicator. The bank is more optimistic about wine companies with strong sales, normal levels of current inventory, and extreme promotion plans on the C side, that is, wine companies with excellent repayment performance after the holiday season & inventory is still at a normal level (profit forecasts for 23 & 24 will not be lowered, and can enjoy valuation switching dividends).
Investment advice: The bank is optimistic about sector investment opportunities where the trend of consumption upgrading in the industry is irreversible, considering:
1) Mid-Autumn Festival National Day Sales/Inventory/Wholesale Performance; 2) Poor 23Q3 Performance Expectations; 3) Changes in domestic and overseas policies & economic expectations are the core catalysts for the current sector. It is recommended to focus on three main lines: 1) Operating at a relatively low level Target: Wuliangye (000858.SZ), Shuijing Fang (600779.SH), etc.; 2) Or enjoy the valuation switching dividend main line (strong α): Kweichow Moutai (600519.SH), Luzhou Laojiao (000568.SZ), Shanxi Fenjiao (000568.SZ), Shanxi Fenjiao () 600809.SH 603369.SH , Welcome to Tribute (603198.SH), etc.; 3) We recommend focusing on the main line of strong beta: alcoholic liquor (000799.SZ), Shede Liquor (600702.SH), etc.