Yili (600887): The core single product maintains a high growth rate and the company’s performance is expected to continue to grow steadily
The company’s performance exceeded expectations, with core single product revenue increasing by 20% + 2019Q1 company revenue 231.
30 ppm, an increase of 17 in ten years.
10%, exceeding market expectations.
We estimate that the company’s room temperature liquid milk revenue in 2019Q1 (accounting for 70% of total revenue) will grow 15% + year by year, with a market share of 38.
8%, up 3 before the first quarter of 2018.
0 PCT, which further enhances its competitive advantage over competing products.
The steady growth of room temperature liquid milk revenue mainly comes from two aspects: (1) the core single product maintained a high growth, the company’s large single product Anmusi and Jindian revenue increased by 20% in 2019Q1; (2) the company actively carried out channel expansion and improved channel penetrationRate, to promote the steady growth of other room temperature liquid milk and other basic milk income.
We estimate that the company’s milk powder revenue (accounting for 10% + of total revenue) will increase by 10% + year-on-year in 2019Q1; low-temperature liquid milk revenue (accounting for about 10% of total revenue) will increase even by a small number, due to increased demand from major industries and increased competition.
2019Q1 company net profit 22.
76 ppm, a ten-year increase of 8.
2019Q1 company net profit 9.
88%, a decrease of 0 from the first quarter of 2018.
88 PCT; gross profit margin 39.
95%, 1 increase before the first quarter of 2018.
The purchase price of raw milk increased by 5-6 percent in the first quarter of 2019. The increase in the company’s gross profit margin was mainly due to the acceleration of product structure upgrades and slower promotions: (1) In 2019, Anmuxi and Jindian launched high-end products to promote product structureAccelerate the upgrade; (2) The sales of products during the Spring Festival peak season are better, and the company’s promotion efforts are expected to be outlined.
2019Q1 company sales expense ratio 24.
07%, an increase of 1 from 2018Q1.
The 31 PCTs are mainly due to the increase in employee compensation, advertising costs and channel development costs.
The product structure upgrade and channel expansion are expected to promote the company’s stable growth in performance. Benefiting from the product structure upgrade and channel expansion, the company’s revenue is expected to continue to grow steadily.
According to the company’s annual report, the 2019 revenue plan is 900 trillion, an increase of about 13%, and we believe that the probability is high.
We estimate that the company’s two core single products, Amuse and Jindian, are expected to maintain 20% + high growth rate in 2019, driving the overall revenue growth: (1) The company will continue to launch new products for Jindian and Amushi to promote product structure upgrades;(2) The company will continue to promote channel expansion.
In addition, the company’s health drinks are expected to continue to increase volume.
Taking into account the effects of market competition, channel development and cost growth, we expect the company’s net margin to decline slightly in 2019.
(1) The price of raw milk 深圳桑拿网 will increase moderately in 2019, and the company is expected to increase terminal buying gifts to increase its market share.
The acceleration of the company’s product structure is expected to gradually affect the impact of gradual cost growth. We expect the company’s gross profit margin forecast to remain stable in 2019.
(2) In recent years, the company will continue to cultivate core competitiveness and widen the gap with competing companies.
And the company will open up new consumption scenarios in 2019, and it is expected that the fee issuance will increase.
We expect the company’s sales expense ratio to remain stable and increase slightly in 2019, with a slight decline in net profit margin.
Investment recommendations We expect the company’s revenue to increase by 13-20 in 2019-2021.
1% / 11.
8% / 11.
0%;深圳桑拿网 net profit increases by 8 each year.
2% / 13.
2% / 13.
8%; EPS is 1.
48 yuan, corresponding to PE is estimated to be 27/23/21 times.
In 2018, the company’s estimated PE center is 25-33 times. We give the company a PE estimate of 30X in 2019, which corresponds to a reasonable value of 34.
5 yuan / share, maintain the company’s “Buy” rating.
Risk reminders: (1) The volume of new products is less than expected; (2) The expansion of channels is less than expected; (3) Food safety issues.