Summary of the report
Event: Tianma Technology released its three-quarter report in 2022, with revenue of 5.312 billion yuan in the first three quarters, an increase of 32.80% over the same period last year, and a net profit of 241 million yuan, an increase of 187.26% over the same period last year.
The volume and price of feed business have risen simultaneously.
The company's feed business is growing steadily. In terms of volume, the company sold a total of 1.0568 million tons of livestock, poultry and aquatic feed from January to September, an increase of 17.5% over the same period last year. Among them, special water feed sales of 155400 tons, an increase of 21.25% over the same period last year, faster than the overall growth rate of the industry 10.5pcts. The proportion and market share of aquatic feed business have further increased. The company continues to refine, expand, strengthen special aquatic feed, man fine compound feed and other special aquatic feed to maintain a leading position in the industry. In terms of price, the overall feed sales tonnage of the company from January to September was 4227.69 yuan, up 5.5% from the same period last year. Among them, the price of special water feed is relatively stable, with a tonnage price of 9229.35 yuan from January to September, down 1.8% from the same period last year. The price of livestock and poultry feed has risen due to the recovery of the industry and costs, with a tonnage price of 3365.64 yuan from January to September, up 8.1% from the same period last year. At the same time, the prices of raw materials in the overall feed business have risen. By the end of September, the average price of fishmeal had increased by 21.2% compared with the same period last year, and the average price of soybean meal had increased by 34.5% year on year. The cost side has a certain impact on the profitability of the company's feed business.
Eel culture accelerates
Eel farming has become a new and important growth driver for the company. From January to September, the company quickly released the volume of fine eel culture, achieving an income of 494 million yuan, which has far exceeded the whole year of 21 years. In terms of volume, the production and marketing of 22Q3's eel fine farming business continued, with a pond output of 2428.5 tons in a single season, an increase of 174.1 tons over the previous quarter. In terms of price, the Manfish market as a whole is in a business cycle, with a 22-year high up 39.8% from the beginning of 21 years. We believe that the company's strategy to promote eel farming business, matched with its own advantages, will reshape the company's growth curve. First, technical ability. The company has accumulated rich technological advantages in aquaculture such as eel. The company has technical platforms such as China Eel Industry Research Institute, "complementary fishing and light", "integration of planting and breeding" and digital intelligence landing application of information to further support the breeding business. The second is the supply of seedlings. The company has maintained a good cooperative relationship with overseas suppliers for decades, and has strong seedling locking ability and quality control ability. Third, the advantage of scale. The company has more advantages than small and medium-sized households in raw material procurement, breeding survival rate, personnel labor and so on.
The traditional business cycle is getting better, and Man Fish opens the second curve.
1) the trend of traditional business is improving. The company itself in feed, animal protection, seedling business steady expansion to promote. In 2022, the company plans to sell 200000 tons of special aquatic feed and 1.3 million tons of livestock and poultry feed, and the main feed industry is expected to maintain steady growth. Downstream pig cycle boom, broiler market is expected to gradually pick up, will support feed demand; upstream soybean meal, corn and other feed raw materials market or marginal improvement, enhance the company's traditional main business profitability. 2) the growth of manfish culture is sufficient. In terms of volume, the planned output of commercial eels is 8000 tons in 22 years, and it is expected to maintain sustained and rapid growth in the next few years. In terms of price, the eel market is expected to continue the boom. In the early stage, affected by the epidemic situation, the market of vegetable eel was slightly adjusted, the efforts of farmers to produce fish were increased, and the stock of specification eel continued to decrease. In the future, with the peak domestic consumption season and Japanese eel festival factors driving demand, eel prices are expected to maintain a prosperous range.
Investment suggestion
Tianma Science and Technology is a large-scale modern fishing and animal husbandry collectivized enterprise which integrates special aquatic products, animal husbandry and food, and integrates the primary, secondary and tertiary industries. The company's traditional feed, seedling, animal protection business continued to grow steadily, eel breeding business accelerated, superimposed a number of business line cycle to improve, the company's performance is expected to be strong.
We estimate that the net profit of the company from 2022 to 2024 is 360 million yuan, 660 million yuan and 880 million yuan respectively, and the EPS is 0.82,1.51,2.01 yuan respectively, corresponding to 22.64, 23 and 24 years PE is 22.64, 12.26 and 9.19 times respectively.
Risk hint
Livestock and poultry, aquaculture cycle fluctuations, eel production expansion is not as expected and other risks.