Hengshun Vinegar Industry (600305): The century-old vinegar industry leader needs to be activated

Hengshun Vinegar Industry (600305): The century-old vinegar industry leader needs to be activated

With hundreds of years of accumulation, I look back for five years, do combing, laying the foundation, and two-wheel drive of vinegar and wine.

  In 2001, the company diversified and became involved in real estate, optoelectronics, and other fields, which dragged down the company’s performance.

  In 2012, the company began to gradually replace the real estate business. In October 2014, the board of directors quickly replaced the auxiliary industry after the completion of the re-election, focused on the main condiment business, and accelerated the internal transformation and upgrading of the enterprise. This one completed the business carding in five years and established vinegar and cooking wineOperating framework of dual main businesses.

At the moment, compared with Haitian, the system is significantly different, and reforms still need to work hard.

From an industry perspective, the CAGR of the vinegar industry is expected to be 7% in 16-21 years, and the scale will exceed 18 billion US dollars in 2020.

However, compared with the soy sauce industry, the vinegar industry has obvious regional division characteristics.

The leading Hengshun vinegar market share / Haitian soy sauce market share is about 7/18%, vinegar / soy sauce CR5 is 20/32%, small and medium-sized workshop-type enterprises in the vinegar industry account for 70%, and urgently needs to be integrated.

The leading national expansion + environmental protection policy + industrial standard improvement 苏州桑拿网 will continue to drive the increase in concentration.

From the perspective of the company, Hengshun’s state-owned enterprise system VS Haitian employees hold shares, and physical differences lead to operating gaps.

In 18 years, the gross profit margin of Hengshun vinegar industry was 4 points lower than that of Haitian Flavor Industry. The average per capita income of Haitian’s production was 6 times that of Hengshun. The difference in the cost rate brought by staff efficiency.1.

8pct, 5.


From the perspective of operation, the channel side: Haitian / Hengshun Catering accounts for about 60% + / 15%, the brand side: Hengshun has not yet gone out of Haitian’s nationalization road; the product side: the vinegar industry is still in the early stage of consumption upgrade.The price is still room.

Looking forward 西安夜网 to the next five years, President Hang will be transferred or expanded to improve channels.

The company recently announced the appointment of Wang Xixianghong as the chairman of Hengshun Group. Hang Zhuhong was the secretary-general / secondary inspector of Zhenjiang Municipal Government, occupied by the deputy department, and has strong local organization resource coordination ability.

We think that the transfer of the group more reflects the local SASAC’s understanding of Hengshun reform. With reference to many precedents in the food and beverage industry, if the company can break through Hengshun’s management mechanism to operating mechanism in the next five years,Help change, expand scope adjustment from the perspective of channel / product / brand marketing, and the marginal flexibility that reform can bring.

1) Product side: In terms of product structure, Hengshun’s high-end products have a gross margin of 50% +, Heng Chen vinegar series, segmented vinegar products to expand publicity efforts, and high-end production capacity to help upgrade. In terms of price, January 2019 has taken the lead in five major varietiesThe ex-factory price has increased by 6-15%, and product upgrades are expected to be one of the company’s main lines of development.

2) Channel side: the first to increase the construction of catering channels in advantageous areas such as East China, with a current scale of about 200 million; in areas outside East China, the current revenue accounted for 51%. If the scale of outlets, channel construction, and sales incentives can be expanded, it is expected to open upIncrease space.

3) Brand side: In the past, Hengshun “emphasized production but light sales”. In the future, the three-dimensional brand marketing of aerial + ground will help to increase brand awareness and promote nationalization.

4) Cost: Production automation is expected to improve production efficiency, improve internal management mechanisms and improve management efficiency.

Profit forecast and investment grade: After completing the business combing of the previous five years, the vinegar industry leader has realized two-wheel drive of vinegar + cooking wine. The next five years is expected to open the adjustment and improvement channel under the breakthrough of Hangzhou General. It is estimated that the company will be in 19-21Net profit growth rate +9.



3%, the corresponding EPS is 0.



56 yuan, PE is 36/31 / 27X, give “Buy” rating.

Risk warning: Expansion of external ports is less than expected, promotion of high-end products is less than expected, food safety risks.