Condiment industry disappointing investors?

From the current point of view, condiments are a high-frequency and just-needed segment in the field of large consumption

The decline in gross profit margin and the increase in the proportion of sales expenses have led to pressure on performance

In the first half of 2021, the fierce market competition in the condiment industry has intensified, and it has fallen into serious "involution"

The first is the decline in gross profit margins

In addition to the external unfavorable factor of rising raw material costs, the increase in the proportion of sales expenses of listed condiment companies is another major reason

Earlier, the net profit margin of listed condiment companies showed an increasing trend year by year

Qianhe Flavor Industry revealed that as of mid-2021, its sales expenses were 234.

High channel inventory and intensive sales channels lead to fierce market competition

Although food has a shorter shelf life, there is also an inventory cycle

In addition, the rise of new retail channels such as live broadcasts and community group buying has also affected the passenger flow of traditional retail channels (such as supermarkets, farmers markets, etc.

The sinking of the market is also the key work of channel expansion for listed condiment companies in recent years

According to Wind data, Qianhe Flavor had 887 dealers in the first quarter of 2019.

For listed companies, increasingly dense sales channels mean increased shipments, but for dealers, it means increasingly fierce competition

Condiment shares slump as consumer services sector falls

Since the stock market correction after the Spring Festival in 2021, the consumer services sector has been in decline, and even listed condiment companies are struggling to escape the downturn

In fact, since the end of December last year, the share prices of companies such as Qianhe Flavor, Haitian Flavor, and Zhongju High-tech have been "halved"

　　From the perspective of price-earnings ratio, listed condiment companies are generally higher

　　From the perspective of valuation, some listed condiment companies whose stock prices have undergone a sharp correction are already within a reasonable range

　　Among the listed companies in the soy sauce sub-category, Haitian Flavor’s current price-earnings ratio is valued at 58 times

　　In addition, institutional investors have deployed condiment listed companies in advance
.
In 2021, the number of medium-term institutional investors will increase significantly compared with the end of 2020
.
Among them, Haitian Flavor has the highest number of institutional investors, reaching 485.
At the end of March this year, the number was only 78.
At present, a total of 130.
4464 million shares have been increased
.
The price-earnings ratio of Zhongju High-tech is relatively low, and the number of institutional investors has reached 328
.
In Jiajia Foods, the number of institutional investors is only 8 because it has just "removed its cap"
.
The number of institutional investors in Qianhe Flavor Industry is 122, and the number in March this year was only 13
.

　　(Comprehensive arrangement by Han Songyan)  

　　"China Food News" (September 16, 2021 04 edition)

(Editor-in-charge: Han Songyan)