Zhengbang Technology (002157):The advantages of piglets with outstanding performance in May are gradually emerging

Category:Company Organization:Guosen Securities Co., Ltd. Researcher:Lu Jiarui Date:2021-06-11

Item:

Company The monthly report published in May 2021 announced that the company had sold 1,648,400 live pigs, an increase of 232.23%year-on-year and a month-on-month increase of 39.17%; sales revenue was 3.65 billion yuan, an increase of 99.92%year-on-year, and a month-on-month increase of 20.26%. In terms of average price, the average sales price of the company’s commodity pigs (after deducting piglets) was 17.52 yuan/kg, a decrease of 17.98%from April 2021.

Guoxin’s views on agriculture:1) The company’s slaughter volume exceeded expectations in May 2021, and the sales of live pigs achieved a year-on-year increase of 99.92%and a month-on-month increase of 20.26%. The logic of volume increase has been strengthened; 2) African swine fever in 2021 The epidemic is still likely to rise, and the company is expected to use its piglet advantages to expand the industry’s competitive advantage and further Consolidate the position of the industry leader. 3) Risk warning:uncontrollable deaths of pigs occurred in the industry, and cost pressures caused by uncontrollable increases in the prices of food and raw materials.

4) Investment advice:Under the normal background of the African swine fever epidemic, the future large-scale process of pig breeding is expected to be completed in the next 2-3 years. The company actively introduced high-efficiency breeding pigs and eliminated low-efficiency Sows, the effect of the”10,000 head introduction” program is expected to gradually appear in the past two years, its piglet advantage will remain the industry leader, and its market share is expected to increase rapidly. We estimate that the company’s 21-23 net return to the parent profit 54.73/65.13/11.034 billion yuan, corresponding to EPS 1.74/2.07/3.51 yuan, corresponding to the current stock price PE is 7.6/6.4/3.8X, maintain”buy Into the” rating.

Comments:

The company’s May slaughter volume has performed well, and it is expected to continue the trend of slaughter at a volume premium. The company will sell 164.84 live pigs in May 2021. 10,000 heads, including 256,700 piglets and 1,391,700 commercial pigs, a year-on-year increase of 232.23%and a month-on-month increase of 39.17%. The growth rate of slaughter exceeded expectations, Productivity continues to be released. In addition, the company’s May sales revenue was 3.65 billion yuan, a year-on-year increase of 99.92%and a month-on-month increase of 20.26%. The steady growth of slaughter data will increase the company’s industry share and competitiveness when the pig price stabilizes and rises. The company is expected to continue the high growth of slaughter. trend. At the same time, the average weight of the company’s commercial pigs in May was 140.52 kg/head, an increase of 7.05%from the previous month. The company’s average slaughter weight continued to maintain a high level, which also showed that the company’s fattening ability is leading. Considering that the company’s 2021 full cost and unit excess return are expected to exceed expectations, continue to focus on recommendations.

Non- plague interferes with the normal iteration of production capacity, and the market share of large-scale breeding has accelerated. Recently, the price of pigs has slightly adjusted, and the overall sector is under pressure. In the short term, the market unanimously expects pig prices to rebound from June to August, and batches of secondary fattening will occur in the industry, and production capacity is expected to be in the process of gradual recovery. However, non-Pest disease is still the main contradiction in the current industry. We believe that the pig industry in 2021 will focus on two core points:1) The African swine fever epidemic in 2021 will more reward breeding groups with strong management capabilities, and the performance differentiation may be more extreme. 2) The downward rate of pig prices has slowed down, and the market share of large-scale breeding has increased rapidly. Zhengbang Technology, as a pioneer in pig breeding, is expected to fully benefit from the golden wave of non-Pest accelerating the market share of leading companies.

The company’s slaughter market forecast for 2021 is 20 million heads and continues to maintain rapid growth. According to research, the company is expected to continue to maintain high-quality slaughter sales in the second quarter of this year, and the chain will increase significantly. The 30%plan of Wantou’s stock market remains unchanged, further consolidating the company’s second position in the industry. At the same time, in the second quarter, the company will complete the elimination of low-efficiency sows as planned, and the”10,000 heads of breed introduction” plan has come to an end, marking the end of the population optimization work. It is expected that as the company’s self-produced high-efficiency binary sows gradually become effective in the future, the cost of piglets will be increased. There has been a significant decline, and the competitiveness of terminal breeding costs is expected to appear, helping the company to steadily improve the complete cost of breeding. Looking forward to next year, the original breeding pigs introduced by the company will give full play to their effectiveness, the company’s piglet advantage will lead the industry, and the market share is expected to continue to increase rapidly.

Investment advice:continue to focus on recommendations

Under the normal background of the African swine fever epidemic, the future large-scale process of pig breeding is expected to accelerate in the next 2-3 years carry out. The company actively introduces high-efficiency breeding pigs and eliminates low-efficiency sows. The effect of the”10,000-head introduction” program is expected to gradually appear in the past two years. Its piglet advantage will maintain the industry’s leading position and its market share is expected to increase rapidly.

We estimate that the company’s 21-23 net profit attributable to the parent is 5.473/65.13/11.034 billion yuan, the corresponding EPS is 1.74/2.07/3.51 yuan, and the corresponding current stock price PE is 7.6/6.4/3.8X, maintain””Buy” rating.

Shuijingfang (600779):Focus on collection masters and increase the cost of investment

Category:Institution:China Sea Securities Co., Ltd. Researcher:Sun Shanshan Date:2021 -06-11

Event:

On the morning of June 8th, 2021, the company will be in the Chengdu holds the 2020 Annual General Meeting of Shareholders.

Investment points:

The core products have high growth, and the target for 2021 is clear. The company’s 2021Q1 revenue is 1.24 billion yuan (+70%), and its parent net profit is 419 million yuan (+120%); 2021Q1 high-end wine revenue is 1.213 billion yuan (+69%), accounting for about 98%. The total number and well platform equipment accounted for about 90%. It is estimated that the combined revenues of Zhenniang No. 8 and well-set installations in 21Q1 will increase by about 68%, and the combined revenues of Collector Master and Jingcui will increase by about 80%. The company’s proportion of the top eight markets has increased from 56%in 2018 to 58%in 2020, and continues to focus on the top eight markets. The company’s business objectives for 2021 (excluding sauces and wines to be deployed):Strive to achieve an increase of 43 in main business%, net profit increased by about 35%, profit growth was slower than revenue growth, due to the company’s increased brand investment.

Focus on master collectors and optimize cost delivery. The company focuses on building masters of the collection, holding high to promote the promotion of Zhenniang No. 8 and well-set equipment brands, and optimizing expenditures. The main focus is on three points:

First, focus on target opinion leaders and research target consumer groups; It is to tilt the investment of collection masters and above products, continue to focus on the Lion King symbol, and build a high-end consumer circle marketing platform-“Shuijingfang? Lion King Club”; the third is to strengthen consumer cultivation and conduct high-end tasting sessions, Tennis sponsorship, etc., turn experience and loyalty into advantages. The company is currently reforming and innovating the collection master channel, and it is expected that there will be concrete results next year. We expect that the proportion of masters in the collection during the 14th Five-Year Plan period is expected to increase from the current 5%to double digits.

Consumption upgrade welcomes the opportunity, and enters the sauce wine to enjoy dividends. The consumption upgrade trend of products in the industry brings room for growth for sub-high-end and above products. We expect the growth rate of the 300-400 yuan price band to slow down, and the 400-600 yuan price band and the 600-800 yuan price band will increase. It is expected that the proportion of sub-high-end and above products will exceed 50%in 2025. The 400-600 yuan growth rate in the 300-600 yuan price band will exceed 300-400 yuan, and a new sub-high-end 600-800 yuan price band is taking shape. Under the current sauce and wine boom, we believe that it will continue for 3-5 years. Shuijingfang has a forward-looking layout of Guizhou Guowei wine industry and cut into the sauce and wine sector. The project is currently in progress. If all goes well, the company will enjoy the dividends of this round of sauce and wine fever.

Earnings forecast and investment rating:Both revenue and profit for the whole year of 2020 will decline, which is due to the impact of the 2020 epidemic.Baijiu will actively destocking under the influence of 2020Q2, which will drag down annual revenue and profits.

We are optimistic about the company’s focus on masters of collections, holding aloft, focusing on the top eight core markets, and creating one of the top brands of Luzhou-flavor liquor. EPS is estimated to be 2.06/2.83/3.83 yuan in 2021-2023, and the current stock price corresponds to PE at 60/43/32 times respectively, and the “buy” rating is maintained.

Risk reminder:The epidemic has dragged down consumption; the operation of the master collection is not as expected; the performance of the top eight markets is not as expected; the progress of the sauce and wine project is not as expected.

Linyang Energy (601222):Teaming up with Yiwei to expand production and energy storage layout further

Category:Company organization:Huaan Securities Co., Ltd. Researcher:Chen Xiao Date:2021-06-11

Joint venture with Yiwei Energy storage battery project, the company accounts for 35%of the company and Yiwei Lithium Energy to jointly fund a joint venture company, The investment does not exceed 3 billion yuan to build an energy storage battery project with an annual output of 10GWh, which mainly produces lithium iron phosphate batteries, of which the company accounts for 35%of the registered capital.

Cooperating with Yiwei for many years, joint venture expansion to accelerate energy storage layout

As early as 2017, the company signed a strategic cooperation agreement with Yiwei to jointly form”Smart Distributed Energy Storage” R&D team. Yiwei Lithium Energy provides lithium iron phosphate batteries, relying on the company’s distributed photovoltaic power plants in the eastern region. Work together to build a smart micro-grid. At present, the two parties are jointly building new production capacity, and the layout in the direction of energy storage is expected to go further. Assuming that each GWh contributes 600 million yuan in revenue, gross margin is 20%, and it is estimated that the newly built capacity will contribute 6 billion yuan per year Revenue and gross profit reached 1.2 billion yuan. The company accounts for 35%, and it is expected that revenue will increase by 2.1 billion yuan, corresponding to a gross profit of 420 million yuan.

The company has signed a distributed energy storage project, and at the same time is cooperating with Huawei Digital Energy to promote energy storage business. As of the end of last year, the company has signed a 2MW distributed photovoltaic + 2MWh energy storage demonstration project, and it is expected to build 2 in the next three years. -3GWh energy storage system project. Recently, the company signed a strategic cooperation agreement with Huawei Digital Energy Technology Company to cooperate in photovoltaics, energy storage and digital energy. The energy storage market has broad prospects. Many domestic provinces and cities have issued energy storage allocation policies. This year will be the first year of the outbreak of domestic energy storage, and the company is expected to directly benefit.

Investment Suggestions

The estimated net profit of the company for 2021/2022/2023 is 11.2/16.2/19.2 billion yuan, corresponding to EPS 0.64/0.92/1.10 yuan . The company vigorously develops energy storage business with broad prospects in the future. The current valuation is low, and the rating of”Buy” is maintained.

Risk Warning

Demand and price rises are less than expected; overseas resumption of work and production is less than expected; the impact of the epidemic has increased.

Huahong Technology (002645):Four departments help Circular economy Fully benefited from car dismantling business

Category:Company organization:Kai Kai Securities Co., Ltd. Company Researcher:Wang Ke Date:2021-06-11

The policy has promoted the development of circular economy, and the company’s car dismantling business has fully benefited. The “Buy” rating is maintained on June 9, 2021. The four departments have issued documents to assist the recycling of scrapped cars, and policies drive the development of circular economy. The company’s car dismantling business is expected to fully benefit. We maintain the profit forecast unchanged. We forecast that Huahong Technology’s operating income will be 51.67/in 2021-2023. 6.577/8.043 billion yuan, we predict the company’s 2021-2023 EPS will be 0.94/1.18/1.50 yuan, and the current stock price corresponds to a price-earnings ratio of 16.3/12.9/10.2 times. As the leader of scrap steel equipment, Huahong Technology has deployed a circular economy. The car dismantling business is expected to fully benefit from it. It maintains its”Buy” rating.

The four departments issued documents to help the circular economy industry, and the scrap car recycling industry fully benefited. According to the information on the official website of the Ministry of Industry and Information Technology on June 9, 2021, the Ministry of Industry and Information Technology, the Ministry of Science and Technology, Ministry of Finance, Ministry of Commerce span>Issued the”Extension Pilot Implementation Plan for Auto Product Producers Responsibility”, clarifying that through the pilot work, a group of auto product producer responsibility extension benchmark enterprises will be established, and an implementation model of auto product producer responsibility extension suitable for my country’s national conditions will be formed. By 2023, the level of standardized recycling of end-of-life vehicles will be significantly improved, and a batch of reproducible and extendable vehicle manufacturers will be the main responsibility of end-of-life vehicle recycling models; the level of utilization of end-of-life vehicles’ renewable resources will increase steadily, and the comprehensive utilization rate of resources will reach 75%. ; The automobile green supply chain system is well-established, and the recycling rate of automobiles reaches 95%, and the utilization ratio of renewable raw materials for key components is not less than 5%.

The company’s layout in the circular economy industry, the automobile dismantling business is expected to fully benefit from the company’s deployment of circular economy, currently has three major scrap and automobile dismantling bases in the country, namely Donghai Huahong, Beijing Huahong and Qian’an Juli , On October 18, 2013, Donghai Huahong was formally established, mainly engaged in recycling of recycled materials and metallurgical furnace charge processing, scrap steel wholesale, waste glass, waste tires and waste plastic recycling and sales; metal materials, mechanical and electrical equipment, rubber and plastic sales, automobiles , Motorcycle accessories sales. In 2020, Donghai Huahong will realize operating income of 404 million yuan and net profit of 16 million yuan. According to the company’s strategic development plan, Donghai Huahong will actively expand the circular economy industry, choose opportunities to carry out related business of scrapped car dismantling, cultivate new growth points of performance, and improve the company’s profitability. The four departments issued a document to help the development of the scrapped automobile recycling industry, Favorites the company’s circular economy business development and the company’s car dismantling business It is expected to benefit fully.

Risk warning:M&A falls short of expectations, project construction progress falls short of expectations, and rare earth prices fall.

Aoyuan Beauty Valley (000615):Layout of medical aesthetics institutions to penetrate horizontally and extend the industry chain to vertical linkage

Category:Corporate Organization:Essence Securities Co., Ltd. Researcher:Liu Wenzheng/Du Yifan Date:2021-06-11

Original business Gradually shrink, the strategy cuts into the big medical beauty track. In May 2020, the company’s original controlling share, Tokyo Han Holdings, and Aoyuan Kexing signed a equity transfer agreement, A total of 229,231,817 shares without restricted circulating shares were transferred to Aoyuan Kexing. In November of the same year, the listed company was renamed Aoyuan Meigu. The controlling shareholder will provide diversified and multi-dimensional potential customer resources and application scenarios through the existing industrial ecosystem to help the development of the medical beauty industry.

Equity incentives bind the interests of core managers, mobilize organizational vitality and improve efficiency. The company intends to grant a total of 18.2 million stock options to 14 directors, executives and core management personnel, accounting for approximately total equity 2.33%, the price of Exercise is 12.62 yuan/copy. The 100%exercise index in the equity incentive plan is that the net profit in 2021 and 2022 will be lower than that in 2020. The growth was not less than 390%and 1390%respectively, and the corresponding net profit was not less than 187 million yuan and 569 million yuan.

Acquisition the assets of high-quality medical beauty institutions, focusing on the development of the main business of medical beauty. The company acquired cash 55%of shares in Lian Tianmei for 697 million yuan. The two hospitals of Lian Tianmei’s subordinates, Lian Tianmei and Victoria, are both Hangzhou old medical beauty institution. Lian Tianmei/Victoria Hospital’s 2020 revenuePing efficiency 24,118 yuan/28,335 yuan, profit ping efficiency yuan 4,023 yuan/4,537 yuan. In 2020, Lian Tianmei’s revenue was 490 million yuan, net profit was 90.547 million yuan, gross profit margin was 55.0%, net profit margin was 16.7%, and its competitive advantages were obvious:①Excellent technical advantages:its hospitals have more than 20 patented technologies, which are China Plastic Surgery Association is the first batch of 5A-level medical aesthetic institutions certified (expires in December 2020, qualifications are temporarily retained), Grade 4 hospitals with high-difficulty surgical qualifications; ②Strong team of doctors in the hospital:There are 58 doctors in its hospitals, including 5 senior and senior, 8 deputy seniors and 16 specially-appointed experts; ③After years of operation and accumulation, it has gained a wide range of user groups by virtue of word of mouth. :It has more than 300,000 members and 80,000 annual active users.

Industry-university-research transformation, layout of recombinant human-like collagen market. Aoyuan Meigu’s wholly-owned subsidiary signed a”Strategic Cooperation Agreement” with Jiyuan Bio, and reached a preliminary intent on the cooperation of medical and aesthetic industry, academia and research.

Jiyuan Bio has successfully developed a series of recombinant human-like collagen raw materials through genetic engineering and fermentation technology. It has been applied in high-end medical beauty skin care products in some markets. In the future, the company will jointly promote it as an initiator Recombinant human collagen applied for three types of medical devices.

Established M&A fund to set up”fullerene” to empower muscle technology project. The wholly-owned subsidiary has signed the”Equity Investment (Transfer) Intention Agreement” with 3 target companies including Dalian Jiyuan Pharmaceutical, and intends to acquire 51%-70%of the target company’s equity with an M&A fund. Investment valuation is based on the target company’s three-year average main business income not less than 1 in 2021-2023 100 million yuan, with a net profit of no less than 30 million yuan. Dalian Jiyuan is a professional medical beauty product supplier and service provider, with its”fullerene” brand-related products, which are widely welcomed by the market.

Cooperate with KDM of South Korea to expand the layout of upstream medical beauty products. Aoyuan Meigu and KDMedical of South Korea signed the”Strategic Cooperation Agreement” and reached preliminary intent on cooperation in the beauty and health industry. KDMedical focuses on the manufacture and sale of medical devices for medical beauty. It has a rich layout of light medical beauty products, covering fat-dissolving injection products, skin-improving kinetic energy, high-frequency therapeutic equipment, sodium hyaluronate for injection, etc., and there are many products. It has obtained quality system certification from many countries, and its sales scope covers more than ten countries including China, the United States, and Japan.

Consolidate the layout of medical aesthetics, and link up and down the industry chain:Midstream has accumulated experience in post-investment management, resource integration, customer integration, data integration, material supply integration, cash flow integration, etc. through the successful merger and acquisition of Liantianmei. The team lays the foundation for the next large-scale merger and acquisition of medical aesthetic hospitals; continues to accumulate high-quality upstream enterprise products, sales channels, and technical reserves such as Jiyuan Bio and Muscle Medicine; downstream medical aesthetics channel end cards, explore vertical light Medical beauty brand chain collection store. Utilize the upstream product pipeline reserve of medical beauty.

Investment advice:The company will continue to promote systematic arrangements for the real estate sector during the year, and will focus on the development of medical aesthetics business in the future. After the divestiture of the real estate sector (the current transaction method and transaction price are still uncertain) The company’s revenue is decreasing. In the future, the company’s revenue will mainly be contributed by green fiber/medical beauty. The 40,000-ton green fiber project was officially put into operation in 21 years. It is estimated that the chemical fiber/medical beauty will contribute revenue of 677 million yuan/558 million yuan in 21 years. We expect the company’s revenue from 2021 to 2023 to be 2.126 billion yuan/2.744 billion yuan/3.764 billion yuan, with growth rates of 7.0%, 29.0%, and 37.2%respectively, and net profit attributable to the parent company to be 168 million yuan/270 million yuan, respectively. /423 million yuan; selected A-share related companies Huaxi Biotechnology, Amec and Langzi shares as comparable companies, with reference to comparable listings in 2021 with an average PE of 141x respectively, giving a target market value of RMB 23.81 billion in 2021, corresponding to a stock price of RMB 30.48 . Give a buy-A investment rating.

Risk warning:Epidemics are repeated, strategic transformation progress is not as expected, medical beauty industry The layout progress is not as expected.

Yongyou Networks (600588):Acquiring Pomelo Technology to complement the front-end capabilities and strengthen the ecological value of YONBIP

Category:Company Institution:Researcher of West China Securities Co., Ltd.:Liu Zejing/Liu Zhongteng/Kong Wenbin/Wang Yandan Date:2021-06-11

Overview of the incident

On June 5, UFIDA plans to spend 151 million yuan Renminbi transferee Youzi Holdings Limited holds 100%equity of Youzi (Beijing) Mobile Technology Co., Ltd. After the equity transfer is completed, the company plans to increase the capital of Yuzi Mobile with RMB 79 million. After the transaction is completed, UFIDA holds 100%equity of Yuzi Mobile.

Acquired the front-end low-code development platform of Pomelo Technology, complemented with YonBIP and strengthened the commercial value Pomelo Mobile focused on the low-code development platform, and established the largest third-party developer ecosystem in China. According to UFIDA’s announcement, Grapefruit Mobile is a low-code platform company with a mature developer ecosystem. So far, it has aggregated many mainstream third parties at home and abroad.PaaS and SaaS cloud service providers have been widely used by 1 million registered developers, with more than 1,300 public modules, more than 20,000 private modules, and more than 20,000 public APIs. After years of in-depth operations, Grapefruit Mobile has been widely used by 1 million registered developers so far, and has established the largest third-party developer ecosystem in China.

Grapefruit Mobile and YonBIP complement each other and strengthen the ecological value of the low-code development platform. Unlike UFIDA’s YonBIP low-code development platform, which is mainly oriented towards 2B back-end management applications, Grapefruit Mobile’s low-code development platform is mainly oriented towards 2C front-end mobile APP applications, and the two complement each other. We believe that this acquisition makes the company one of the few domestic vendors with a complete low-code platform from front-end to back-end, from 2C applications to 2B applications.

Furthermore, this acquisition integrates the low-code development capabilities of Grapefruit Mobile into the company’s BIP Ecosystem is to further strengthen the YonBIP ecosystem, release the commercial value of low-code platforms, accelerate the process of YonBIP business innovation platform to provide global enterprises with digital and intelligent transformation services, and empower the transformation and upgrading of traditional industries.

Overseas giants deploy low-code development areas, and the global market scale55 billion in 2024 The dollar-level review of the history of low-code development platforms at home and abroad, overseas Internet giants such as Google have earlier deployed low-code development areas. As early as 2016, Google, Dell and other Internet giants have already deployed in the low-code field, May 2018 OutSystems, a low-code development platform, received US$360 million in financing from KKR and Goldman Sachs. In June 2019, Salesforce launched low-code commercial blockchain products. In April 2020, Microsoft announced that its low-code/no-code development tool Power Platform will be commercially available in China.

The explosion of massive applications is an important factor in promoting the development of the low-code market. In 2024, the global market will be 52.3 billion yuan. In the era of rapid development of the mobile Internet, the growing demand for smart phones and massive App applications has become a key factor in promoting the development of the global low-code market. According to a Forrester report in 2018, the global market for low-code development platforms has reached 5.6 billion U.S. dollars, and it is expected to rapidly climb to 52.3 billion U.S. dollars by 2024. 65%of application development will be low-code development, with a compound growth rate of 45.2%.

The low-code development platform realizes 80%of the functional platform configuration, and 20%of the individual needs for secondary development, which greatly saves development costs. Calculated according to domestic standards, the cost of a middle-level developer is 15,000 per month. Under the traditional model, the secondary development of enterprise management software such as financial systems requires at least six months to one year, and the development cost is high. After adopting a low-code development platform, a project can realize more than 80%of the project’s functions through the platform configuration, and less than 20%of the special functions are based on the platform for secondary development, which can achieve a seamless connection between secondary development and the platform, compared with traditional development Faster, greatly saving development costs.

The company has benefited from the opportunities of the three waves of localization, digitalization and globalization. The acquisition of Pomelo Technology will help complement YonBIP and strengthen the commercial value of the low-code development platform. We maintain our previous profit forecasts for the company. We estimate that the company’s operating income will be RMB 103.4/133.0/17.24 billion in 2021-2023, and the net profit attributable to the parent will be RMB 12.23/116.66 billion, respectively. Taking into account the company’s dominant position as an enterprise-level SaaS leader, the company will be given 35 times P/OCF in 2021, continue to recommend, and maintain a”buy” rating.

1) The risk of lower-than-expected software business growth; 2) The lower-than-expected risk of cloud product promotion; 3) Increased competition in the ERP industry; 4) Downside risks of the macro economy.