Zhejiang Meida (002677): Q1 Revenue Exceeds Expectation Brand Promotion + Channel Construction Consolidates Leadership

Zhejiang Meida (002677): Q1 Revenue Exceeds Expectation Brand Promotion + Channel Construction Consolidates Leadership

Event Zhejiang Meida released the first quarter report of 2019: 成都桑拿网 operating income in Q1 of 20192.

60,000 yuan, an increase of 31 in ten years.

63%, net profit attributable to mother is 75.35 million yuan, an increase of 22 year-on-year.

09%, net profit of 72.15 million yuan deducted from non-attributed mothers, an annual increase of 21.

26%.

The company’s Q1 performance in 2019 exceeded market expectations.

  Brief Comment (1) The revenue in the first quarter exceeded expectations, and the growth of integrated stoves was significantly higher than that of the kitchen appliance industry in the first quarter of 2018. The company’s operating income was 2.

60,000 yuan, an increase of 31 in ten years.

63%, exceeding market expectations.

  According to Zhongyikang from January to March 2019, the growth rate of range hood retail was -9.

36%, -13.

78%, 4.

83%, the growth rate of retail 成都桑拿网 sales of gas stoves was -3.

73%, -20.

78%, 5.

32%, in March, the stove market was affected by factors such as price cuts and sales. However, overall, due to the influence of the real estate post-cycle, the kitchen appliance market as a whole is still sluggish.

  Integrated stoves have come out of a relatively independent market. According to Taobao & Tmall online sales data, the sales volume of integrated stoves Q1 increased by 217.

4%, with an annual increase of 191.

5%, an increase of 3 from Q4 of 18 years.

3 pieces, 26 pieces

3 points.

The integrated stove industry is still in a period of rapid development, significantly integrating the kitchen appliance industry.

In 2018, the retail volume of traditional fog machines: integrated stoves was 100: 6.

9, ranking the ratio of 100 in 2017: 3.

5. The penetration rate of integrated stoves continues to increase.

  (2) The company’s profitability is stable, its gross profit margin remains stable, and its brand promotion continues to grow.

09%, net profit of 72.15 million yuan deducted from non-attributed mothers, an annual increase of 21.

26%, gross margin is 53.

84%, basically the same as the same period of last year. The slight decline in the price of raw materials formed a hedge with the March promotion, resulting in a stable gross profit margin and stable profitability of the company.

  In terms of period expense ratio, Q1 sales expense expense was 15.

5%, up 4 every year.

98 points, up 5 from the previous month.

21pct, the increase is obvious, mainly due to the company’s increase in high-speed rail, new media and other advertising investment. At present, the company’s development has entered a new stage. Brand promotion and consumer education have become its essential factors.The development potential has laid the foundation.

Benefited from the reduction of share payment accruals and management expenses.

69%, a significant decline every year 6.

26pct, which shows that the company’s management efficiency has continued to improve; financial costs have decreased by -0.

52%, basically the same as last year.

  (3) Industry competition has intensified. Thanks to the leading advantages, Meida has continued to increase rapidly. According to data from Zhongyikang, the number of participating brands in the online integrated stove market in 2018 was 173, equivalent to 128 in 2017, and brand participation increased by 35The number of samples on the market is 808, an increase of 100 from last year.
In terms of sales volume and schedule, Zhejiang Meida is ranked in the first echelon. After the release of 1.1 million (sets) of additional production capacity in the second half of the year, it will gradually maintain its leading position and continue to grow its integrated stove business.
  In 2018, the TOP10 brand retail share was 72.

4%, about 2017, TOP10 brand concentration increased by 5.

6%, through increased competition, industry concentration has increased.

  (4) Deeply cultivate a three-dimensional channel network to improve market coverage. In terms of channel sinking and terminal outlets, the company developed a total of nearly 200 first-tier dealers in 2018, and newly opened more than 400 terminal stores.In 1300 dealers, there were nearly 2,500 marketing terminals. At the same time, the company successively signed a strategic cooperation agreement with Red Star Macalline, Actually Home, Suning Tesco, and increased the distribution of KA channels for home appliances.

  On the engineering side, the company completed 10 residential hardcover projects in 2018, strengthened active contact and communication with real estate developers, and established good cooperation intentions with many well-known real estate developers.

In terms of e-commerce channels, online marketing channels have been established in professional e-commerce platforms such as Tmall, JD.com, Suning.com, and Gome Online. At the same time, the company’s official online mall has been established, forming a combination of online and offline with beautiful features.The O2O sales model has broken a good foundation for improving product market share and achieving rapid development.

  Investment suggestion: We are optimistic about the subsequent increase in the penetration rate of the integrated stove industry and Zhejiang Meida’s leading position in the integrated stove industry. It is expected that the company’s revenue will increase by 30 in 2019-2020.

00%, 25.

00%, profit is 4 respectively.

8.3 billion, 5.

9.9 billion, an annual increase of 28.

00%, 24.

00%, corresponding to PE17.

77, 14.

33X, maintaining the “overweight” rating.

  Risk warning: domestic competition intensifies; raw material prices rise; channels sink below expectations.