Xiwang Foods (000639): Marginal improvement of flagship flagship store of health food before starting

Xiwang Foods (000639): Marginal improvement of flagship flagship store of health food before starting
The core point of view is dual main business and dual brand, and the margin of performance improves.The company is the leading brand 北京夜生活网 of domestic corn oil, with a current market share of 30%.In 16 years, he successfully acquired Kerr, a Canadian company, and entered the field of health nutrition.Kerr is mainly engaged in the sales and research and development of whey protein and weight management products. The core products Muscletech and Hydroxycut are well-known in North America.17 years of sports nutrition has contributed 52 to the company.7% of operating income, officially re-opened the sports nutrition + vegetable oil dual main business go hand in hand profit model.The performance change of the average value of the two main industries in 2017 due to factors such as cost, and the drive of high-end corn oil + sports nutrition out of the channel / cost impact, since 18H1, the company’s performance growth rate has increased quarterly, and the marginal improvement has been obvious. Sports nutrition products look at the space: the market space is broad, the company’s brand advantages are outstanding, and it is expected to take the lead in enjoying the industry growth dividend.We believe that under the three driving factors of increasing fitness numbers, increasing per capita consumption, and increasing the penetration rate of sports nutrition products, the market for sports nutrition will gradually increase in the future: 1) and the number of fitness members only accounts for 1 of the number of physical exercisers.6%, compared with 15 in the North American market.6% space is still large 2) Per capita consumption of sports nutrition in Croatia is only 0.$ 07, compared with $ 20 in the United States over the same period.61 dollars, the difference is huge, and there is huge growth space for the same per capita consumption level. 3) After the consumption banner is gradually moved after the 1990s, the demand for high-quality and high-value sports nutrition will further increase, and the penetration of sports nutrition in the futureThe rate is also expected to increase.The companies each have a rich product matrix. The core products muscletech and Hydroxycut are well-known in the North American market and their recognition in China is higher than other brands. At present, muscletech’s market share in China has reached 26%, ranking first.In the vast market space, we believe that it is expected to surpass the advantages of the brand and take the lead in enjoying the growth dividend of the industry. Vegetable oil market share increased: corn oil penetration increased under healthy demand, raw material advantages will become a weapon to expand market share.Corn oil has a high nutritional value and is more in line with the current health needs. In the future, the penetration rate of the domestic edible oil market will be gradually increased.We believe that under this trend, the company also has a strong incentive to increase market share: 1) channel development.At present, the company’s channels are concentrated in the East China region, which has only ample space for development compared to the national market; 2) The entire industry chain can ensure product quality.The whole industry chain production can strengthen the control of the production process, improve product freshness, help the company’s products to be more recognized by consumers, and expand brand influence; 3) relying on the support of major shareholders, the company has the advantage of raw materials and competesIn the moderately high edible oil market, the advantages of raw materials can protect the company’s profitability and is a weapon to increase the city’s share. Financial forecasts and investment recommendations are given a BUY rating for the first time with a target price of 13.97 yuan.Taking into account the company’s vegetable oil and protein powder business-related comparable companies, the DCF estimation method was used to obtain a company value of 13.97 yuan / share.Give the company a target price of 13.97 yuan, corresponding to 19 years of PE is estimated to be 20.5 times. Risks indicate food safety risks.Channel expansion was less than expected.Exchange profit or loss risk.