Shuijingfang can't drop high inventory

Author | Tang Fei

In terms of cultural heritage, Shuijingfang does not lose Moutai and Wuliangye at all.

"Shuijingfang" originated from the Sichuan Wine Roast Site discovered in 1999. It is named "Shuijingfang" because it is located in Shuijing Street, Chengdu. The site has a 600 -year history of winemaking. , Known as the "First Square of Chinese Baijiu".

In 2000, Shuijing Street Winery was rated as "Top Ten Archaeological Discovery in the Country in 1999", and the "Shuijingfang" liquor was born in the same year. In May 2021, Shuijing Street Winery was loaded into the Great World Guinness Record with the title of "the oldest brewing workshop". In June 2001, Shuijing Street Winery was fifth batch of key cultural relics protection units in the country's judges in the State Council.

There are many honors on Shuijingfang, carrying deep historical culture, and its brand culture and brand stories are also called the epitome of Chinese liquor culture.

However, in terms of scale, Shuijingfang seems to have always been difficult to stand on the first echelon, and can only be ranked behind the "Mao Wu Meiyang" all year round.

In the first half of this year, the epidemic repeatedly caused an impact on liquor consumption scenarios to a certain extent. The sales of liquor terminals were generally under pressure, and Shuijingfang was also difficult to be alone.

Inventory high voltage

If you use a sentence to summarize the performance of the first half of the year of the water, "increasing income without gain".

According to the latest semi -annual report released by Shuijingfang, the company achieved revenue of 2.074 billion yuan in the first half of the year, an increase of 12.89%year -on -year; net profit of home mother was 370 million yuan, a year -on -year decrease of 2%.

Regarding such a dilemma, Shuijingfang believes that during the reporting period, my country's economy continued to face demand shrinkage, supply shock, expected weakness, and weakened triple pressure. At the same time, it was impacted by super -expected factors such as the domestic epidemic rebound.

It is true that the main consumption scenarios of liquor are mainly friends gathering and business entertainment, and the epidemic does reduce the consumption behavior in the above scene to a certain extent.

However, compared with the two listed companies of the wine industry and alcoholic wine at the same time at the same time, it is obvious that Shuijingfang is really slow.

Given that the wine industry and the liquor wine have not yet released the second quarter report, we choose the first quarter report data as a comparison. In the first quarter, the revenue growth rates were 83.25%and 86.04%, respectively, and the net profit growth rates of home mother was 75.75%and 94.46%, respectively. -13.54%.

On the other hand, the inventory pressure of Shuijingfang cannot be underestimated. As of the end of June 2022, Shuijingfang's inventory reached 2.321 billion yuan, which was higher than the first half of the year. Under the pressure of inventory, Shuijingfang may face the threat of "inverted price".

In the second quarter, the number of days of inventory in Shuijingfang was 1292 days. Compared with 1205 days last year, it increased by nearly three months in a year.

Regarding the pressure of inventory, Zhu Zhenhao, CEO of Shuijingfang, said that due to the impact of the environment, the social inventory of Shuijingfang in the first half of the year has increased compared with the same period last year, but the overall level remains healthy. "Under the circumstances of the economic environment and the limited restrictions on liquor consumption scenarios, we continue to expand the circle through digital marketing, consumer cultivation, and opening a new group purchase model to continue to promote store sales to maintain the health chain health."

At the annual report of 2021, the value planet (ID: valueplanet) found that the asset -liability ratio of Shuijingfang was higher, from 43.34%in 2017 to 55.33%at the end of 2021. By June of this year, Shuijingfang's asset -liability ratio further climbed to 56.35%.

While the debt ratio climbed further, the cash in Shuijingfang's hands was not optimistic. In the semi -annual report, the "net cash flow generated by business activities" was particularly dazzling. As of the end of the second quarter, the data of Shuijingfang was only 1.4464 million yuan, a year -on -year decrease of 99.48%.

In this regard, Shuijingfang said in the semi -annual report that this change is mainly due to the growth of other business activities such as market advertising fees paid by payment.

Kou Xing, chief analyst of Huaxi Securities Food and Beverages, also believes that in an interview with the media, considering that the growth of sales revenue in Shuijingfang is basically the same as the growth rate of revenue, pre -collected payments have increased slightly from the previous month. The main reason for the significant decline in "net cash flow generated by business activities" is "income growth is lower than the growth rate of expenses", and the difference in payment cycle has led to the growth of cash outflow of operating activities.

Generally speaking, in the first half of the past, Shuijingfang was "happy and worried."

Trapped in high -end

Although Shuijingfang brewed early history, the appearance of the Shuijingfang brand in the market was relatively short. It mainly relied on marketing and promotion in the construction of high -end brand images.

In the first half of 2022, the company's sales expenses were 696 million yuan, an increase of 19.27%year -on -year. In the first quarter of the Spring Festival sales season, sales expenses expenditure was 410 million yuan, a year -on -year increase of 52.75%.

Looking back at history, it can be found that from 2017 to 2021, the total investment in the advertising costs of Shuijingfang was 3.698 billion yuan, and the total net profit of the same period of the same period was only 3.672 billion yuan, and the numbers of the two were almost equivalent.

In the past five years, the sales expenses of Shuijingfang accounted for nearly 28%of the company's operating income, far exceeding the average level of 18.6%of the industry.

Therefore, people can frequently see that Shuijingfang appears in various media or activities through various forms such as names and sponsorship. Since 2000, Shuijingfang has become a sponsor of the Chinese City Tennis Tournament for 14 consecutive years, and restarts the event in 2021. In addition, in 2008, Shuijingfang and the China Tennis Association established strategic cooperation to support top professional tennis events; in 2021, they became strategic partners with the Shanghai Rolex Masters, and have formed in -depth bundles with tennis.

As the country vigorously promotes the ice and snow sports, Shuijingfang has reached a cooperation with the China Ice and Snow Conference, and launched two products: the collection ice and snow version and the well platform ice and snow version. High -end consumer groups of table tennis.

In addition, Shuijingfang also sponsored the TV section and joined for three times to join for three times. At the end of 2020, the third season of "National Treasure" was launched in CCTV. It is reported that the exclusive championship price of the third season of "National Treasure" is suspected in the range of 120 million to 139 million yuan, and the first season of the first season of the first season of the crown of the first quarter The name price only exceeds 10 million.

According to data from the Guoyuan Securities Institute, by July 2022, the average price of high -end liquor has been above 1,200 yuan. However, at this price, Moutai, Wuliangye, Yanghe, and Luzhou Laojiao have a solid position. Later, Shuijingfang challenged the challenge.

In recent years, the company has continued to raise prices for core products. From 2017 to the present, the retail price of No. 8, Jingtai, and Collection Master has risen from 438, 658, 899 yuan/bottle to 528, 808, 1399 yuan/bottle, and the price increase reached 20.5%, 22.8%, and 55.6. %.

At the same time, in order to complete the corresponding sales performance, the number of sales staff in Shuijingfang increased from 211 in 2016 to 506 in 2021.

In July 2021, Shuijingfang also established Chengdu Shuijingfang high -end sales company, which was completely held by 25 dealers. Among them, 24 are the company's provincial provinces, which include the core market of the first echelon of Henan, Hunan, Jiangsu, Sichuan, and Guangdong. It also covers emerging core markets such as Hebei, Shandong and Zhejiang.

The sales company operates in 14 key cities across the country in accordance with the "1+N" model. Each city arranges a distribution channel dealer and N group purchase dealers according to the actual situation. The provincial foreign classic dealers can give priority to becoming a circulating channel dealer or group purchase channel dealer. The two channels require that the task volume is not less than 5 million Box and 1 million boxes.

In the first half of the year, these high -end products brought a revenue of 1.984 billion yuan to Shuijingfang, accounting for nearly 97%of the revenue ratio.

Unfortunately, the gross profit margin of Shuijingfang's high -end products is lower than those of peers. Last year, the gross profit margin of Shuijingfang's high -end product was 85%, and the interest rate of the mid -to -high -end liquor in the wine industry was 87%. The gross profit margin of the internal reference series of alcoholic wine was close to 92%. It has stood in the same echelon with the gross profit margin of Moutai.

Relying on high marketing investment and strong sales routes to promote high -end products, the actual profit is difficult to catch up with competitors.

"Internationalization" does not go back and retreat

As the first A -share and the only foreign -funded holding white wine company, Shuijingfang's products seem to have a unique innate advantage.

Since 2006, British -funded Emperor Emperor Emperor Emperor continued to acquire Shujingfang shares and eventually became the actual controller of Shuijingfang in 2011.

According to the data, Diageo, as the world's first liquor giant, has rich experience in mergers and acquisitions, has more than 2,2520 employees in more than 80 countries and regions around the world. The 2022 FY performance report shows that Diageo's net sales in the 2022 fiscal year were 15.5 billion pounds (about 128.15 billion yuan).

In the 2011 annual report, Shuijingfang clearly stated in the "future development strategy" that "Chinese liquor companies with certain international brand influence" and "accelerating the pace of international market expansion". It is also the export sales of Shuijingfang at this year, which was 68.418 million yuan, an increase of 51.78%year -on -year, accounting for 4.6%of the current total revenue.

However, in 2021, Shuijingfang's foreign revenue was 33.9251 million yuan, a year -on -year increase of 291.76%, and the proportion of total revenue was only 0.73%. Compared with the data of ten years ago, the data did not increase and fall.

Faced with the "uninterrupted" road of internationalization, Shuijingfang changed the previous "rapid internationalization" attitude. In public, "liquor is a product with strong Chinese cultural attributes. Fiery wine brands, they also have a long history of brand cultivation. It is very difficult to change the taste of foreign consumers in a short time. Foreign liquor consumption requires a long time and more investment in funds. It is far less than the domestic market. Through cooperation with Diageo, the company's products are currently available in tax and tax -free channels in many countries and regions. "

From the previous experience, it is not easy for liquor companies to go to sea. In the past few years, head wine companies such as Maotai, Wuliangye, and Luzhou Laojiao have made targeted international investment, including the development of international dealers, sponsoring large -scale events, major activities and other overseas marketing activities and cultural promotion activities to overseas Output culture and brand.

Unfortunately, the overall effect is very small. The above three companies' overseas revenue in 2019 only accounts for 3.5%, 0.9%, and 0.11%of the total revenue. In 2020, it further decreased to 2.6%, 0.3%, and 0.09%. From an industry perspective, the output of liquor above the domestic size above scale of 2020 was 7.4073 million liters, and the export volume was only 14,000 liters, accounting for 0.19%of the domestic output. There is also another set of data. China's liquor consumption is close to one -third of the world's spiritual wine, but the proportion of market share in the world is less than 8%. good.

The internationalization of liquor is slower, both internal and external causes.

On the one hand, although liquor has achieved overseas sales, the overall lack of international standard system. Because liquor is divided into a variety of incense types such as thickness, clearing, and sauce, it is more complicated to distinguish, which makes it difficult for foreign consumers to distinguish. On the other hand, the liquor pricing system is relatively chaotic. Although there are many concepts such as production areas and years, there are no uniform standards, which hinders consumer decision -making.

Facing the huge overseas market, Chinese liquor is obviously in the stage of "crossing the river with stones".

In the long run, the domestic liquor market has entered a stage of slow growth, and the market share has also entered the "era of cakes". Therefore, it is likely that the future growth space of the winery is likely to be the international market.

Summarize

At present, the strong situation of the strong strong in the liquor sector is becoming increasingly prominent. The sales of Shuijingfang were worried about being squeezed by head brands such as Moutai, Wuliangye, and Guojiao 1573.

As more and more resources are concentrated in head brands, the "28 Laws" of the liquor industry will become more and more serious. In the future, more liquor companies will face significant performance of performance, and Shuijingfang is just a microcosm.

In the financial report, Shuijingfang admits: "In the second half of the year, the liquor industry is expected to continue to face the challenges caused by the epidemic and economic slowdown, the channels for marketing are difficult, the social inventory increases, and the cash flow is tight."

Reference materials:

[1] "2021 Liquor Consumption Trends Report", Yipuso

[2] "Deep Report: Product channels are actively conspiring, and the development of Shuijingfang is expected to accelerate", Oriental Securities

[3] "Focus on the core market, reshape the high -end image -Shuijingfang Company In -depth Report", Cinda Securities

[4] "Shuijingfang: Short performance pressure, high -end promotion is expected to drive profit margins," Guoxin Securities

*This article is based on public information, which is only used as information exchange, and does not constitute any investment suggestions

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