In the "Compendium of Materia Medica", it is recorded: "Tofu, also known as milk, is made with tofu pickled with lees or sauce, and the taste is salty and sweet." The ancient books of the Wei Dynasty also record that "dried tofu is fermented after ripening with salt", and by the Ming Dynasty, a large amount of curd milk had been processed. Today, curd has evolved into a fermented food with modern processes. As a selected listed enterprise, Changchun Zhulaoliu Food Co., Ltd. (hereinafter referred to as "Zhulaoliu"), a condiment enterprise specializing in curd milk, sauerkraut and cooking wine, has successfully locked in the "admission ticket" of the Beijing Stock Exchange.
Excellent performance
Leading condiment segment industry
"Zhu Laoliu" is a leading condiment company in Jilin Province, mainly engaged in curd milk, sauerkraut and cooking wine and other condiments, of which curd milk is the top priority, the founder team has developed curd products since 1991, after years of research and development has accumulated rich experience, the scale of curd production ranks among the top three in China.
By the end of 2020, Zhu Laoliu's revenue of curd milk, sauerkraut and cooking wine accounted for 84.88%, 12.10% and 2.60% respectively, and the gross profit accounted for about 87.08%, 10.58% and 2.13%. In the same period, the company's curd milk production capacity was 25,000 tons /year, sauerkraut production capacity was 8,700 tons/year, and cooking wine production capacity was 2,000 tons/year.
Zhu Laoliu's revenue in each business accounted for in 2020
Source: Wind
According to the third quarter report of 2021, Zhu Laoliu's revenue doubled, achieving operating income of 200 million yuan in the third quarter, an increase of 13.63% year-on-year; net profit attributable to the owners of the parent company was 44.339 million yuan, an increase of 23.05% year-on-year. The company adheres to the principle of "spending small money and doing big things", in 2019 and 2020, the expense rate during the sales period is 15.96% and 10.87% respectively, and the overall cost is decreasing year by year.
The decrease in the selling expense ratio reflects the company's cost reduction and efficiency gains, and the gradual increase in cash flow is one of the manifestations of the company's flexibility.
In the third quarter of 2021, Zhu Laoliu's net cash flow from operating activities was 42.08 million yuan, which was relatively stable compared with the same period last year. Among them, the net cash flow generated by the company's operating activities from July to September 2021 increased by 283.01% over the same period of the previous year. In addition, the company's debt ratio has further decreased from 27.80% at the end of 2020 to 14.88%, and the company's performance has achieved high-quality growth.
Zhu Laoliu's asset-liability ratio (%) in 2018-2021
Such data, compared in the industry, can also be found, is relatively excellent. For example, Haitian Flavor Industry, a leading condiment company that started in Foshan, is the most important product at present. Haitian Flavor Industry, which has become the leader in the market value of 500 billion yuan, has also slowed down the growth rate of revenue and net profit attributable to the mother in the past three years.
From 2018 to 2020, Haitian Flavor industry achieved operating income of 17.034 billion yuan, 19.797 billion yuan and 22.792 billion yuan respectively, an increase of 16.80%, 16.22% and 15.13% year-on-year; the net profit attributable to the mother was 4.365 billion yuan, 5.353 billion yuan and 6.403 billion yuan, an increase of 23.60%, 22.64% and 19.61% year-on-year. Among them, the soy sauce revenue in 2018-2020 reached 10.236 billion yuan, 11.629 billion yuan and 13.043 billion yuan respectively, an increase of 15.85%, 13.60% and 12.17% year-on-year.
It is not difficult to find that the growth rate of Revenue and Net Profit Attributable to the Mother of Haitian Flavor Industry in the past three years has slowed down, which is related to the decline in the revenue growth rate and revenue proportion of the main product soy sauce. There are many kinds of soy sauce brands on the market, such as Lee Kum Kee, Kitchen Bang, Lu Hua, Qianhe, etc., and the market competition in the soy sauce field in the condiment industry is quite fierce. The competition in Zhu Laoliu's curd subdivision industry is far less fierce than that of soy sauce.
In-depth study of the main business
The company's growth path is clear
"Oriental cheese" curd
Zhu Laoliu pushed for local characteristics
Curd milk is a traditional delicacy unique to China and belongs to the fermented food of soybeans. Curd has a high protein content, is easy to digest and absorb, and is known as "oriental cheese". Condiment industry in the sauce segment of the consumption growth, to further promote the sales growth of curd products, is expected in 2021 China's sauce industry market size to maintain steady growth, by 2025 is expected to achieve a market size of about 14 billion yuan. The subsequent consumption boundary of the curd market is expected to be further broadened.
The market size of the domestic sauce industry in 2021-2025
Source: Prospective Industry Research Institute
In addition, according to China's traditional eating habits, curd milk is one of the indispensable special condiments in hot pot dipping sauce. From 2013 to 2018, the market size of China's hot pot industry increased from 281.3 billion yuan to 481.4 billion yuan, with an average annual compound growth rate of 11.34%, and it is expected that by 2022, the hot pot market size will reach 707.7 billion yuan.
In addition, Zhu Laoliu's curd milk also has local characteristics. The research of the First Financial Business Data Center shows that the new generation of consumers are more and more receptive to the tastes of various places, the diversification of tastes is more obvious, and the northern cuisine represented by the northeast cuisine has penetrated widely in the south, which brings a broad market space for the curd milk of the northeast flavor seasoning.
"Famous on the list" specialty pickled sauerkraut
Zhu Laoliu is expected to promote industry integration
Sauerkraut, known in ancient times as "sauerkraut", is a vegetable pickled food, mainly fermented by lactic acid bacteria. Due to the long winter in the northeast region, fresh vegetables are not easy to store, and sauerkraut has become a must-have dish in the northeast region. From 2011 to 2015, the average annual compound growth rate of The market size of China's sauerkraut industry reached 26.27%, and the market size of the sauerkraut industry in 2020 exceeded 8.33 billion yuan, while northeast sauerkraut accounted for half of the size of China's sauerkraut market.
However, the dispersion and level of sauerkraut production enterprises are different, and there are problems of brand confusion and inconsistent production standards in the industry. With the ban on Dakeng sauerkraut, it has brought a large market gap to the sauerkraut industry, according to the relevant reports of the Liaoning Provincial Food and Drug Administration when cleaning up dakeng sauerkraut, the scale of sauerkraut in the northeast is about 2 million tons, and the output value is about 10 billion yuan. It can be seen that Zhu Laoliu, who has a high market share in the northeast and has local characteristics, also has certain advantages in the integration of the sauerkraut industry.
Subdivision track
Zhu Laoliu's growth path is clear
1. "First pay and then goods" settlement mode, with strong bargaining power.
Zhu Laoliu adopts a distribution-based sales model, the settlement method is "first pay and then ship", which effectively guarantees the stability of the company's cash flow, and prevents the occurrence of bad debts, providing a strong guarantee for the company's performance, and then bringing a stable and sustained dividend ability, 2018-2020, the company's cash dividends distributed are 20.15 million yuan, 20.15 million yuan, 40.3 million yuan.
It is worth noting that the company's upstream raw materials include non-GMO soybeans, cabbage, edible alcohol, salt and flour, etc., and the supply is sufficient and scattered, and the company enjoys certain bargaining rights.
2, starting from the northeast, to the whole country, the "branding" road of sauerkraut.
After nearly 20 years of development, Zhu Laoliu has more than 130 distributors in the northeast region, covering all kinds of large-scale chain supermarkets, agricultural stalls, convenience stores and catering enterprises, and has fully realized the layout of various forms of terminal markets. As of the end of 2020, the operating income of the northeast market accounted for 69.96% of the company's main business income in the current period. Considering the factors that the tastes of North China, Shandong and Northeast China are similar, the company actively builds sales channels in North China and East China, and the proportion of sales outside Northeast China has increased from 23.76% in 2018 to 30.04% in 2020.
Zhu Laoliu has made sauerkraut another key product for the company's future development. In the first half of 2021, through brand building and market promotion, the operating income of the three businesses of curd milk, sauerkraut and cooking wine increased by 6.92%, 29.02% and 26.86% year-on-year, and the gross profit margin contribution of sauerkraut products was "indispensable", and the sauerkraut business is expected to become another performance growth point of the company in addition to curd milk.
3, profitability is higher than the industry average, the company's advantages are obvious.
Compared with Hengshun Vinegar Industry and Qianhe Flavor Industry in the same industry, in the first half of 2021, Zhu Laoliu's sales gross profit margin was 40.10%, slightly lower than that of Qianhe Flavor Industry, but higher than Hengshun Vinegar Industry; the net profit margin on sales was the highest among the three, about 2 times that of Hengshun Vinegar Industry and about 3 times that of Qianhe Flavor Industry; the return on net assets was also far ahead of the three, reaching 11.55%. It can be seen that Zhu Laoliu's profitability ranks at the forefront of its peers.
Comparable profitability for peers in the first half of 2021
summary
Compared with neighboring Japan and South Korea, China's condiment market has a large room for improvement, in this context, Zhu Laoliu has a relatively complete local sales network, automation and large-scale production capacity and strong product development and quality control capabilities, and in May 2021 actively raise funds to expand production, is expected to add 15,000 tons of curd milk production capacity, further promote the company's market share. In the future, the company will continue to strengthen market development and channel construction outside the three northeastern provinces, and make multi-faceted efforts to make "small curd milk into big business".
Market-related analysis opinions are for reference to non-recommended stocks only
Investors operate accordingly at their own risk
The stock market is risky and you must be cautious when entering the market
Source丨East Asia Economic and Trade News Reporting Group