Shanxi Fenjiu (600809): 1Q19 revenue continues to grow steadily

Shanxi Fenjiu (600809): 1Q19 revenue continues to grow steadily

1Q19 results are in line with expectations The company announced the 1Q19 results: operating income.

580,000 yuan, a year-on-year increase of 25%; net profit attributable to the parent company8.

77 trillion, an annual increase of 23.

6%, corresponding to a profit of 1.

01 yuan.

Revenue and profit in the first quarter of 19 were in line with expectations.

At the same time, the 2018 revenue reached 93.

800 million, exceeding our United Nations expectations8.

3%, mainly due to the continued strong growth of high-end blue and white fen wine, low-end wine consolidation exceeded market expectations.

Development Trends We expect high-end Qinghua Fen liquor to continue to maintain strong growth, mainly benefiting from the rapid expansion of the sub-high-end liquor market, and the competition 四川耍耍网 of the mean value of Qinghua Fen liquor in Shanxi and the country.

The company is vigorously investing in advertising and channel fees for blue and white, and the cultivation of consumers in Bfen, and continued steady growth can be expected.

We expect the growth rate of blue and white fen in 2019/2020 to reach 77% / 35% to US $ 2.3 / 3.1 billion.

Extra-provincial growth has begun to become the main driving force for growth. The proportion of extra-provincial income in the first quarter has reached 47%, which is 4 percentage points higher than in 2018.

The company’s ability to nationalize has begun to improve significantly. The high price growth outside the province has driven the company’s steady growth.

Companies in Henan, Shandong, Inner Mongolia have maintained rapid growth of about 50%.

The company is still 深圳spa会所 in the expense period. We believe that the short-term internal profitability is difficult to increase rapidly, mainly because the company is still in the process of nationalization, lack of brand influence in most provinces and cities, and market expenses can offset the strength.There is still a need to continue nurturing consumers, and multiple sub-brands are in the process of being promoted.

Earnings Forecast Due to the strong growth of the second high-end blue and white fen, we raise our 2019/20 earnings forecast2.

5/4% to 19.

94/24.

8.2 billion.

It is estimated and recommended that the company currently corresponds to 25/20 times P / E in 19/20 and maintains the recommended level. However, due to the upward revision of the 2019 profit forecast, we will target price from 67.

5 yuan up 2.

5% to 69 yuan, corresponding to 19/20 30/24 times P / E, compared with the current 20% space.

Risk If the company continues to spend heavily, it is difficult to improve profitability