Behind The Roller Coaster Of Liquor Market: Secondary High-End Hot Spots Only Belong To A Small Number Of People. Why Do Fund Managers Have A "Tacit Understanding"?

One day down, one day up.

On July 5, the liquor sector, which plummeted 4.29% in the previous trading day, became active again, rising 2.75% by midday.

Repeat this year's liquor plate, such repeated horizontal jump of the market can be said to be common.

In the first half of the year, the A-share liquor index has seen a number of red days with an increase of more than 4%, and a "dark moment" when it plummeted by 8.55%.

The performance is still supported by the stock price

Overall, the performance of liquor companies in the first half of 2021 is still strong.

According to the statistics of 21st century economic reporter, the liquor index of A-share rose by 11.98% in the first half of this year.

The increase not only outperformed the food and beverage industry (up 0.35%, the same later), but also beat the market index (3.4%).

Although the index is still rising, but the liquor plate has been significantly differentiated.

According to the data, in the first half of 2021, as many as seven of the 18 liquor makers in A-share market fell, and half of the liquor stocks (9 liquor makers) whose gains outperformed the market share price were expected to decline.

Specifically, shede liquor (600702. SH), Jiugui Liquor (000799. SZ) and Shuijingfang (600779. SH) saw the largest increases in the first half of the year, reaching 150.21%, 63.32% and 52.19% respectively. Shunxin agriculture (000860. SZ), Laobaigan wine (600559. SH) and jinzhongjiu (600199. SH) declined the most, which were - 41.72%, - 16% and - 15.87% respectively.

This is in sharp contrast to the general rise in 2020.

In 2020, the A-share liquor index will rise as high as 137.47% in the whole year, and all the 18 plate targets will rise. Among them, Kouzijiao (603589. SH), the slowest, also increased by 29.37%, significantly outperforming last year's market (13.87%).

Behind the market differentiation is the fundamental differentiation.

The 21st Century Capital Research Institute has found that performance is still the main support for liquor stock prices in the first half of 2021.

In the first quarter of this year, the A-share liquor sector (replaced by Shenwan liquor index) achieved a revenue of 94.868 billion yuan, up 22.37% year-on-year; The net profit attributable to the parent company was 35.511 billion yuan, with a year-on-year increase of 17.61%.

Similar to the leading industries in terms of stock price growth, shede liquor, Jiugui Liquor and Shuijingfang also ranked among the top in the first quarter, significantly ahead of the industry average.

In the first quarter of this year, the revenue of shede, Jiugui and Shuijingfang increased by 154.2%, 190.4% and 70.2% year-on-year, and the net profit increased by 1031.2%, 178.9% and 119.7% respectively.

In the liquor industry, the most important sales collection projects, the performance of the above three companies in the first quarter of this year also ranked the top three in the industry.

In the first quarter of this year, the year-on-year growth rates of accounts receivable from shede, Jiugui and Shuijingfang were 2278.1%, 258.7% and 159%, respectively.

Although the performance data of the second quarter of this year has not yet been released, according to the results of channel tracking research, the financial data rate of several liquor companies with outstanding performance in the first quarter will continue to rise.

Taking shede as an example, Cinda Securities pointed out that the channel expansion momentum of shede liquor industry under the new manufacturer relationship was good, and the sales return in the second quarter increased steadily.

After seeing the advanced students, we should look at the backward students.

Shunxin agriculture (000860. SZ) and Laobaigan liquor (600559. SH), which had the largest decline in the first half of the year, also ranked the bottom in the liquor sector in the first quarter of this year.

The former's revenue decreased by 0.7% year-on-year, and the net profit increased by 5.7%; The latter's revenue decreased by 0.3% year-on-year, and the net profit decreased by 14.6%.

Outbreak of secondary high-end liquor

"This year, the secondary high-end is too fierce." Wang Long (pseudonym), a liquor researcher with public funds, sighed to the 21st Century Capital Research Institute,

It is not difficult to observe the first half of the year's rising list, and it is not difficult to find that the top gainers such as shede liquor, Jiugui Liquor and Shanxi Fenjiu (600809. SH) are all secondary high-end liquor.

In this regard, Wang Long told the 21st century capital research institute that the popularity of secondary high-end liquor this year, "in essence, should be the same as in 2011, high-end liquor is at the top, and there is a large space for the next high-end."

It is estimated that after Guizhou Maotai (600519. SH) and Wuliangye (000858. SZ) have opened the price space, the scale of domestic secondary high-end liquor industry is expected to expand from 70 billion yuan to about 110 billion yuan in the next three years, with an annual compound growth rate of about 20%.

"Specifically, several secondary high-end brands have their own recovery logic this year." Wang added.

For example, shede liquor, which had the largest increase in the first half of the year, has been adhering to the "shede" + "Tuopai" dual brand strategy after Fosun system gained control, attracting dealer resources by developing customized products, and promoting the recovery and expansion of sales channels.

In the first half of this year, the stock price of shede rose 150.21%, and the number of limit (28 times) and the number of down limit (16 times) were ranked in the top ten of the limit and limit list of a shares in the first half of this year, ranking the fourth and the first respectively.

The rising trend of shede liquor industry has even attracted the report of private placement big v.

On June 9, Dong Baozhen, the executive partner of Lingtong Shengtai and fund manager of fojitai, made a micro Blog Report in real name, saying that the share price of shede might be illegally manipulated.

In addition to the profit increment brought by the opening of price space and product price increase, the expansion of sales area is also an important reason for the performance growth of secondary high-end liquor.

For example, Shanxi Fenjiu has launched its "1357 + 10" key market outside the province, with more than 850000 core terminals. It has continued to develop the market in the south of the Yangtze River, where the annual growth rate of the past three years has exceeded 50%; Shede liquor opened the East China market with the help of Fosun system.

In a survey conducted in June this year, Jiugui Liquor also said that the driving force for the doubling of the performance of its important product series "internal reference" this year "mainly comes from the investment promotion in the core market and blank market outside the province".

Zhongtai securities also pointed out that in the past, secondary high-end liquor enterprises were more powerful in the province or local regions due to the brand power factor. This year, the secondary high-end liquor enterprises have significantly accelerated the pace of national expansion.

The 21st Century Capital Research Institute noted that if the base water is squeezed out and the performance of the same period in 2019 is taken as the benchmark, the year-on-year growth data of secondary high-end liquor is still relatively good.

Statistics show that the revenue growth rate of A-share secondary high-end liquor in the first quarter of this year increased by 22.2% year-on-year, and the profit growth rate increased by 29.2% year-on-year, both of which were significantly better than those of the third line liquor (revenue - 1.9% year-on-year and profit - 4.5% year-on-year).

Watch out for bubble risk

As one of the core sectors of the organization group last year, Baijiu shares have been favored by the fund.

From the position situation of the first quarter of this year, the liquor position of the fund remains high.

In the first quarter of 2021, the fund's position in liquor was 8.29%, down 0.19% from the fourth quarter of 2020, still at the highest level in history.

At the same time, the fund liquor position of the over match range has been expanded.

In the first quarter of this year, the market value of liquor accounted for 6.92% of the market value of a shares (excluding banks, oil and petrochemicals). The proportion of the fund's liquor position over allocation reached 1.37%, higher than 1.31% in the fourth quarter of 2020.

Anxin Securities pointed out that in the case of significant adjustment of liquor after the Spring Festival, liquor positions only dropped so slightly, "fully indicating that the institutional recognition of liquor fundamentals is still high".

Considering the huge increase of liquor index in the second quarter (32.82%), liquor stocks will still be the sector with heavy institutional positions in the second quarter.

Why is liquor so attractive to institutions?

Liu Dong (not his real name), a private equity fund manager who has been tracking the liquor sector for a long time, told the 21st century capital research institute that many fund managers would "be brave enough to buy" for the sake of yield.

"The goal of many fund managers is not to get high returns, but to survive. Based on the roe of 15% - 20%, if the fund manager first matches the liquor of 40% position, it can ensure that there is 6% - 9% basic return. The fund manager looks for the ticket to do the income again, can guarantee to run to beat the index. The remaining half of the positions can be flexible. In this way, the annual income of individuals can reach more than 15%, which makes it easy to survive in the public offering industry. " Liu explained.

Head liquor institutions heavy warehouse, small and medium-sized liquor stocks become the market hot money competition.

Wang Long told the researchers that the current institutional liquor positions are "quite concentrated" and "small liquor is rarely involved".

"The ticket of small liquor has been rising all the time, attracting speculative funds, and now it has become the target of the game," Liu Dong also expressed a similar view, "Baijiu now has a large amount of non consumer funds, such as the funds used to watch TMT. The pricing power of some liquor stocks has been transferred from those who engaged in consumption to those who do TMT and hot money. "

Behind the changes in capital, there are risks that are constantly amplified.

Wang Long told researchers that if the market environment remains stable, there will be institutional buying of Baijiu stocks. However, if there is the kind of collapse in the first quarter of this year, liquor stocks will "fall 30% - 50% at a time.".

Liu Dong indicated the valuation risk of small liquor ticket.

"For many small liquor tickets, the performance has not returned to the level of the same period in 2019, with a year-on-year growth of up to 10%. But now the valuation is three or four times what it was before. " Liu said.

It said that if the small wine continued to fall, the short-term funds involved would not take over: "the more people fell, the more quickly they fell. When it comes back to ten or twenty times the valuation, it will be bought back by the consumers. "

It is worth mentioning that, in addition to the fierce fighting on the capital side, the fundamentals of the liquor sector will also usher in the first "stress test" after the epidemic in the second half of the year. In the third quarter, liquor stocks will no longer enjoy the year-on-year low base bonus brought by the epidemic last year.

Western securities also predicted that under the condition of good progress in the first half of the year and certain certainty in the annual performance, the liquor sector's performance in the second half of the year would be "a reasonable and predictable decline".

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