Investment advice: Maintain the “Overweight” rating and maintain the target price of 78.26 yuan. Maintaining the profit forecast, the company's 2024-26 EPS is estimated to be 3.04 yuan, 3.67 yuan, and 4.26 yuan, respectively.
The structural characteristics of soju continued in the latter half of the inventory cycle. We believe that the current industry is in the latter half of the inventory cycle, and the industry is accelerating from passive inventory replenishment to active inventory removal, and the industry is showing obvious squeezing growth and product structure settlement; in this dimension, the Sujiu regional market is in a situation where stock competition and incremental games coexist, and the northern Jiangsu region is showing obvious squeezed growth, but there is still room for growth in central and southern Jiangsu; in terms of price, prices above the lower end are still showing phased expansion.
Multiple factors resonate, and the present world continues to show countercyclical ability. Similar to the previous cycle, we have observed that in the latter half of the current industrial cycle, the share of the province is still on the rise; we believe that the company's growth logic mainly comes from: 1) the company has a deep product structure, and the company has developed and developed to meet current liquor consumption trends; 2) in the latter half of the inventory cycle, channel value is greater than brand value. The company's channel organization structure is gradually maturing, and the advantages brought by channel thrust are prominent; 3) From the perspective of the product life cycle, Yaxi and Kaixu are still at the stage of development and maturity in the product cycle, and have not yet reached its maturity ceiling.
Conjecture about the growth space of current world relationships in the later cycle. In the latter half of the industrial cycle, the market has always paid more attention to the company's growth space. We believe that the company has a solid foundation for endogenous growth: 1) from a provincial perspective, the trend of liquor consumption is expected to sink or continue for a certain period of time, and the company can still hope to continue to expand its share with channel advantages and product life cycle dividends; 2) From a national perspective, the introduction of brand awareness and organizational structures outside the province will take some time, but the two have compound interest effects. Along with the core overseas markets, the company will nationalize or enter a stage of acceleration.
Risk factors: management team changes, food safety, industrial policy adjustments, etc.