Juewei Food (603517): Performance in line with expectations Clear growth path

Juewei Food (603517): Performance in line with expectations Clear growth path
Event: The company released its first quarter report, with Q1 revenue of 19 in 2011.5.4 billion (+19.63%), net profit attributable to mother 1.810,000 yuan (+20.38%), deducting non-net profit 1.7.9 billion (+21.19%). The investment point income was in line with expectations, and the store opening accelerated month-on-month: the income in 19Q1 was 11.5.4 billion (+19.63%), a significant increase from the previous month / year. Channel studies show that Q1 companies have increased their support for store opening policies, and the number of new stores opened by dealers has accelerated. It is expected that by the end of Q1, 10,000 stores will be broken across the country.The price increase also contributed.In terms of products, the fresh goods / packaging / joining income was 11 respectively.1/0.02/0.140,000 yuan, the proportion of income increased +0 from the previous 18 years.12 / -0.09 / -0.02 points.In terms of different regions, Southwest China / Central China has developed rapidly, and the proportion of income has gradually increased from 18 years earlier1.13/0.43 points, high gross profit also led the growth of overseas markets.The company’s convertible bond project has been implemented, and its production capacity has continued to increase.7 The initial marinade project has been put into operation with a net profit 杭州桑拿 of 0.7 trillion reached the expected benefits, two projects in Heilongjiang and Guizhou are expected to start production in 18Q4.The company issued convertible bonds to expand Tianjin, Jiangsu, Wuhan and Hainan.93 highest production capacity, budget Shandong 3 warehouse center planning, factory management shifts to product value orientation, and flexible supply chain management requirements are expanded. Costs are properly controlled, and Q2 pressure is expected to be low: 19Q1 gross profit margin 33.31% (-1.1pc), the company lays out raw materials ahead of time, reserves them in the down period of the 18-tail duck by-product prices, and stocks 5 raw materials at the end of the year.8% (+ 47%), about 2-3 months of use, the inventory at the end of 19Q1 period decreased by 1 from the end of 18.44 ppm, with expected raw costs 苏州夜网论坛 properly managed to smooth existing margins.19Q1 advance payment 2.150,000 yuan, +0 from the beginning of the year.9.9 billion, intended to lock in the cost of upstream raw materials. Combining inventory calculations, it is expected that the pressure on raw material costs in Q2 will also be controlled.Selling expense ratio 7.27% (-0.04pct), management expense ratio (including research and development) 5.56% (-0.42pct).Affected by the issuance of convertible bonds, the financial expenses for this period were 2.19 million yuan, which increased significantly each year.In summary, the net interest rate of Q1 is 15.7% (+0.1 pct), net profit attributable to mother 1.810,000 yuan (+20.38%), deducting non-net profit 1.7.9 billion (+ 21%). The company’s medium- and long-term sustainable growth path is clear.1) The shop space is vast.We estimate that the capacity of Juewei’s stores nationwide is expected to reach 23,191. According to the current pace of opening 800-1200 new stores each year, the growth certainty is relatively high; 2) Excellent channel profit.According to grassroots research, the start-up capital of Juewei franchise stores is about 100,000 yuan, and the investment recovery period is about 12-18 months.On the whole, channel profit levels and sustainability are higher than similar food processing and retail stores, and they are universally applicable. Third- and fourth-tier cities are prone to sink. Joining is a good business.3) The platform-based retail model can be copied.The 18-year-old brand “Pepper Spicy” was launched in 18 years, and the store is expected to improve the products that match the halogen, and the diversified development will raise the ceiling of the taste. Earnings forecast and investment grade: Optimistic about the expansion of Juewei category to build a gourmet ecosystem. It is estimated that Juewei revenue will be USD 5/56 / 6.3 billion in 19-21, an increase of 15/12/11%; net profit attributable to mother 7.7/9.2/10.4 ppm, an annual increase of 20/20/13%, corresponding to an EPS of 1.87/2.24/2.53 yuan.The current corresponding PE is 25/21 / 18X, and we maintain the “Buy” rating. Risk reminder: cost fluctuation risk, epidemic risk, intensified market competition, joining management risk.