Jinwu Financial News | According to Dongwu Securities Research, Wu Xiangdong (66.7%), the actual controller of Zhenjiu Li Du (06979), has successively acquired Xiangjiao, Kaijiao, Jiangxi Lidu, and Guizhou Zhenjiu since 2003 to create a leading domestic private liquor enterprise centered around the three major companies, four major brands, and various flavors. The listed entity Zhenjiu Li Du used “flagship Zhenjiu, Guobao Li Du, the region's leading cellar and Xiang Xiang Kai” as the third-level growth engine. 15.8%, 17.4%
According to the bank, since 2024, soy wine brands have simultaneously entered a phase of decline and adjustment along with the industry, and the soy wine craze has declined. In the future, competition for liquor will no longer simply be a matter of category taking precedence over brands, and more emphasis is placed on the comprehensive operation capabilities of wine companies. 1) Comparing soy sauce and strong wine horizontally, the brand concentration of second-tier and third-tier wine companies in the soy wine industry is still increasing in the early stages, and major soy wine products will still have product cycle and channel resource advantages in the future. 2) Looking at the internal comparison of soy wine, the first-tier and second-tier soy wine companies have taken shape, and Zhenjiu already ranks in the top 5 in the soy wine industry in 2023. Comparatively speaking, the advantage of Zhenjiu lies in the company's detailed management on the channel side and the continuous cultivation of C-side marketing. During the downturn period, it can guarantee healthy inventory and price markets through task adjustments, and strengthen brand awareness through experiential marketing, so it is expected to better meet the next round of flexible demand release.
The bank said that along with weakening demand, the company's short- to medium-term profit growth has slowed accordingly; however, it is optimistic that the company's demand will recover and be resilient in the medium to long term, and it is expected that high-priced fine wine products will increase significantly in volume. From 2024 to 2026, the company's non-IFRS net profit is expected to be 1.62, 1.74, and 2.04 billion yuan, respectively; +0.1%, +7.2%, and +17.2% compared to the same period, corresponding PE is 13.4, 12.5, and 10.7x, which gives a “buy” rating for the first time.
