Huatai Securities: The first to give child Wang (301078.SZ) a "buy" rating with a target price of 26 yuan

Zhitong Finance APP was informed that Huatai Securities released a research report that the first to give the child Wang (301078.SZ) "buy" rating, as a leading enterprise in China's maternal and infant retail industry, it is expected that the net profit attributable to the mother in 2021-23 will be 4.33/5.61/719 million yuan, and the EPS will be 0.4/0.52/0.66 yuan / share, considering that the maternal and infant retail industry has high-frequency, high-viscosity attributes, and the company's heavy membership model, deep ploughing retail stores, and digital empowerment to shape the core competitive barriers. Give 22 years 50 times PE, the target price is 26 yuan.

The main views of Huatai Securities are as follows:

Child King: Positioning the new family in the city, the leading brand of maternal and infant retail and service

Child King is positioned in the data-driven, user-based management of innovative new family service platform, professionally provide maternal and infant goods and services and other omni-channel one-stop solutions, the company's core management team retail industry management experience is rich, channel dividends accelerated release, mature store operation efficiency, service business continues to expand, the company's growth momentum is expected to continue to increase.

Industry: High-frequency high-viscosity mother and baby track, embracing consumption upgrades

The maternal and infant industry has high-frequency and high-viscosity consumption attributes, the scale of rapid growth, according to data, in 2020 China's maternal and infant market size reached about 4.09 trillion yuan, 10 years CAGR reached 15.1%. At present, the birth rate is sluggish is the core focus of the development of the maternal and infant market, through the review of the growth experience of Nishimatsuya, the Japanese maternal and infant retail leader, the bank found that in the context of the decline in the birth rate, blank area coverage + consumption upgrades can still continue to drive the growth of leading income against the trend.

The bank believes that China's birth rate is sluggish or normalized, but the leading market is still low, and in the future: 1) three-child and supporting policies to buffer the decline in fertility; 2) The vast sinking market space still needs to be tapped; 3) The switching of new and old kinetic energy, after 80-90, it has become the main force of fertility, and the consumption willingness + consumption capacity has been improved to promote the upgrading of maternal and infant consumption. Optimistic about the concentration of advantages of leading enterprises.

Company: Heavy membership, deep cultivation of large stores, digital empowerment, shaping the core competitive barriers

The company's moat is deep: 1) platform operation: platform service advantages are leading, with "goods + services + social" to dig deep into the value of single customers, parenting consultants and other enhance consumer stickiness, service revenue accounted for a high proportion, business model leading the industry;

2) Channel integration: The offline end deeply cultivates the big store model, takes the lead in seizing high-quality property resources, leads the industry in the number and quality of channels, and opens up the omni-channel layout at the online end to create a borderless shopping experience;

3) Digital empowerment: From the supply chain to the user management of the whole process of digitization, empower the supply chain management to improve efficiency, but also to achieve thousands of people and thousands of precision marketing. Looking forward to the future, with the accelerated release of channel dividends, the improvement of mature store operation efficiency, and the continuous expansion of platform business, the company's growth momentum is expected to continue to increase.

Risk warning: The development of the epidemic is uncertain, and the channel expansion is less than expected.