The cost of raw milk rose moderately, and the growth rate of pasteurized milk went up. Affected by the rising cost of feed (corn, soybean meal, alfalfa, etc.) and the contraction of raw milk supply, domestic raw milk prices rose 5% in 2019 compared with the same period last year. Milk prices have fallen from high levels since the epidemic and have shown an upward trend in June, and have now returned to pre-epidemic levels. as consumer demand picks up and feed cost prices rise, we expect domestic raw milk prices to continue to rise moderately in 2021. Category: pasteurized milk accelerated growth, yogurt growth slowed down, UHT milk entered the mature period. In 2019, the proportion of pasteurized milk / UHT milk / yogurt was 8.2%, 22.4% and 35.6%, respectively. In 2015-19, the growth rate of pasteurized milk increased from 6.1% to 11.6%, and the growth rate of yoghurt decreased from 23.4% to 11.5%, and the growth rate remained low in single digits. Sub-channels: the proportion of online channels increases, while the share of traditional channels goes down. In 2010-19, the share of online channels increased from 0.2% to 6.0%, while the share of traditional channels decreased from 44% to 29.2%.
Dairy industry information plate two-wheel drive, into the "southwest first dairy enterprise" strategy. At present, the company basically spun off the film and television business, focusing on the dairy industry and information services. 1-3Q20 realized operating income / return net profit of 17.09 / 33 million yuan, which was 64.4% compared with the same period last year. Sales of dairy products and food increased steadily in 2014-19, to 190800 tons in 2019, a year-on-year increase of 11.1%. In 2015-19, the company's information sector revenue CAGR reached 130.6%. In 2020, the company took the initiative to carry out digital transformation and cooperate with Shangtang Technology, Orange Heart Optimization and other enterprises to promote the resource integration and business coordination of the two core businesses of dairy industry and information.
Information business empowers dairy marketing to actively build a national platform. The company's offline marketing network covers urban and rural areas, including dealers, door-to-door distribution, specialty stores, canteens, schools, vending machines and so on. The company takes advantage of the new media wave to broaden its channels and explore e-commerce, live streaming, Douyin, Wechat, Alipay, Little Red Book and other platforms. During the epidemic, the company devoted itself to the "new retail", successively cooperated with Li Jiaqi and Weiya to market Murphy Buffalo and other products, and placed advertisements on Wechat and Douyin.
Investment advice. We estimate that the company's operating income in 2020-22 is 24.86,27.73 and 3.098 billion yuan respectively, an increase of 10.3%, 11.5% and 11.7% over the same period last year, and the net profit of returning home is 0.68,0.99 and 124 million yuan respectively, up 39.3%, 46.6% and 25.0% respectively. The company will be given 30-35 times Ppace E in 2021, corresponding to a reasonable value range of 3.60-4.20 yuan. For the first time, coverage gives a "neutral" rating.
Risk hint. The industry competition intensifies, the information service business development is not as expected, and the food safety problem.
