Deep ploughing baking oil field for 20 years, vigorously expand the range of products to help the company's long-term development. According to the application field, the company's products are mainly divided into five series: baking application oil, light cream, stuffing, frozen dough and imports, covering more than 200 varieties. Among them, oil is the core business of the company, the company has been deeply ploughing the field of baking oil for more than 20 years, with an annual production capacity of about 101100 tons, ranking among the top in the industry. However, at present, the domestic baking oil industry is leading the strong competition from foreign enterprises. Therefore, the company not only focuses on the baking oil field, but also vigorously develops the research and development of light cream, frozen dough and other products and the extension of application scenarios. It is planned that in the next three years, the business territory will be expanded to include West Point cakes, companion gifts, and the full range supply of frozen dough in baking enterprises. in order to meet the huge and diversified market needs of ordinary consumers and the goal of quality control and profit control of enterprise users. In the future, frozen dough and baked oil are expected to continue to drive the company's profit growth.
The profitability has increased steadily, and the scale effect has been highlighted. The company achieved a total operating income of 2.322 billion yuan in the past 20 years, down 1.2% from the same period last year, but achieved a net profit of 325 million yuan in the past 20 years, an increase of 9.0% over the same period last year.
In addition, the gross profit margin of the company's main business maintained a high and steady upward trend from 2018 to 2020, which was 34.97%, 38.74%, 38.78%, respectively, and the net profit rate was 11.75%, 12.69%, 14.02%, respectively. The revenue of Q1 in 21 years was significantly higher than that of Q1 in 20 years, with revenue of 648 million yuan, an increase of 43.69% over the same period last year, and a net profit of 97.6467 million yuan, an increase of 127% over the same period last year. Compared with Q1 in 1919, revenue also increased by 16.2% and net profit increased by 18.7%. On the other hand, baking oil enterprises have shown obvious scale effect and brand effect in recent years. Only baked oil enterprises with complete production equipment and technical support can meet the high standards of each link. To maintain advantages in the industry competition, after years of development, the company has a large-scale professional production line and technical team, which has a great advantage in the future industry competition.
The simultaneous development of direct sales and distribution, actively open up regional markets and optimize sales channels. At present, distribution income accounts for more than 60% of the company's income, mainly for scattered but large number of end customers, this kind of customer management is more difficult, and the distribution model can put end customers into the scope of dealer management, thus greatly reducing management costs. In addition, for the processing enterprises with large production and operation scale, the company adopts the direct selling model, and the company has maintained a cooperative relationship with many high-quality direct selling customers for many years. The mode of direct distribution development at the same time not only reduces costs for dispersed customers, but also maintains high-end direct customers, so that the company has the advantage of sales channels. In terms of regional expansion, the company actively plans to increase investment and deepen the sinking of sales channels in third-and fourth-tier cities in the next three years. The development of sales area is expected to bring more high-quality long-term cooperative customers and achieve higher market penetration.
Investment suggestion: we expect the company to achieve EPS 0.90,1.03,1.23 yuan in 2021-2023, corresponding to PE 54,48,41, covering for the first time and giving "overweight" rating.
Risk tips: increased competition in the industry, rising prices of raw materials, food safety problems, regional expansion is not as expected, and so on.
