Taoli Bread (603866): The growth rate of new and old market echelon growth rate or the trend of stopping the system

Taoli Bread (603866): The growth rate of new and old market echelon growth rate or the trend of stopping the system

Analysis of regional market development stages.

The company’s overall expansion is smooth, the old market channels have grown steadily and steadily, the new market has seen a marked improvement in profit performance as its scale has grown, and some markets have entered an adjustment period, and then gradually returned to normal.

1) Northeast China: A quick overview of revenue growth, or the gradual decline in net income due to the increase in daily ratio and sinking of channels.

The Shenyang market can still achieve double-digit growth, or the Northeast market as a whole is far from reaching the limit, and the growth rate of more than 10% in the future should be sustainable in the long term; 2) North China: The revenue has grown steadily, and the gross profit margin or changes in sales strategies &The factory operating rate is low and exceeds the lower limit of the background. Expanding the net interest rate against the upward trend may indicate that the scale effect of the North China market is accelerating, and single-site improvements are being made to improve product distribution efficiency. 3) East China: The Shanghai market is undergoing a comprehensiveThe adjustment and increase in expenses led to the improvement of regional revenue growth. The decline in profit growth of Shanghai subsidiaries led to the gradual increase of the East China telecom net profit margin. Through the Shanghai adjustment and gradual improvement of the forecast and the increase in the size of new markets, the East China net interest rate gradually aligned with other mature regions.Increased to more than 10%; 4) Southwest: Or due to the improvement of the sales team’s relaxation and the diversion of yeast products, the growth rate of revenue has gradually dropped. The company has gradually reorganized its products and 四川耍耍网 personnel, and looks forward to returning to normal after adjustment; 5) Northwest: RevenueGrowth rate has dropped, and net margin is expected to improve slightly; 6) South China: Scale continues to be rapid扩Zhang, foster market matures, the region is expected to present rapid narrowing trend is expected for 19 years in South China is expected to turn a profit; 7) Central: still testing the market, 2H18 business does not happen, look forward to the Wuhan plant in June to promote the region to open up after the operation.

The scale effect is gradually increasing, and the pressure of cost growth is controllable: In the early stage of the company’s new market development, the sales scale of scattered outlets was insufficient and the distribution density of the outlets was limited, resulting in low logistics transportation efficiency and sales staff service outlet efficiency, and the lack of flexibility in related expenses.Raise the overall cost rate level.

From the perspective of a single outlet, the growth rate of single outlets continued to improve and resumed positive growth in 2H18. Although it was hindered or affected by the flow of customers at outlets in 19 years, considering the company’s 19-year revenue planning goals are reasonable and a large number of new outlets opened in the early stageThe new outlets have gradually evolved to the second new outlets, and mature outlets have evolved. It is expected that the single point of revenue may continue to continue a positive growth trend. The drop in gasoline prices will also help control the single point of transportation costs, thereby controlling the pressure on sales expenses.

In the long run, the new market will gradually mature and gradually return to the 12-14 year conversion level with the main sales expense ratio of product distribution, personnel expenditure and other substantial expenses. The company’s performance in the next 5-8 is expected to enter a stable and sustained release period.

Investment advice: Benefiting from the rapid expansion of the breakfast market, the short-term guarantee bread is in the golden development period, with a compound growth rate of 13% in the next 5 years.

The industry’s scale effect is obvious and the mature business model is highly reproducible. The company’s market share is far ahead. The continuous strengthening of the scale leadership & channel exclusive advantage is shaping a broad moat, which is expected to grow into an absolute leader in the industry.

At present, the company’s national expansion is progressing smoothly, with improved outlet structure and reduced pressure on single-point transportation costs. The upward trend of the short-term sales expense rate may be offset, and the long-term expense rate will gradually change back to historical levels. The company may enter a stable and continuousPerformance release period.

We maintain our net profit forecast for 19-21 with an EPS of 1.


45, 1.

78 yuan, corresponding to 34 for PE.

7, 27.

3, 22.

3 times, maintaining the “recommended” level.

Risk reminders: 1. Risk of weak macro economy: slower economic growth, consumption upgrades are not up to expectations, leading to faster consumer growth; 2. risks of major food safety incidents: consumers are particularly sensitive to food safety issues.Major food safety accidents, it takes a long time for consumers to overcome the freezing point and reshape their confidence in the brand in the short term; 3, the expansion effect is less than expected risk: the company is promoting national expansion, and new market cultivation faces more uncertainty, orAs a result, performance was lower than expected.