Maotai's share price exceeds the price of wine, why?

Beijing News Shell Financial Correspondent Sun Yong PengShuo Zhang YuxinJuly 1, the first trading day of the second half of 2020, Guizhou Maotai again rose, breaking through the 1500 yuan integer mark in one fell swoop, which means that the price of a maotai wine has exceeded the official retail price of a bottle of 53 degrees Feitian MaotaiSince mid-March, in just over three months, Maotai's rise has exceeded 57%, during which time its market value has surpassed that of the "big bank in the universe" Industrial and Commercial Bank of China, becoming the new A-share king2019, Maotai won more than 30% of the revenue and nearly 50% of the net profit of 19 liquor listed companiesIts gross margin of over 90% and net interest rate of over 50%, in nearly 4000 A-share listed companies, is even more uniquethen, what does Maotai have to do? Is the current static PE over 45 times overrated? In the face of the five grain liquid to catch up, the next decade, Maotai and still can still go forward?the price of the price of wine, Maotai with what?is first and foremost a strong brandAlthough Maotai has repeatedly applied for the "national wine" trademark is fruitless, but from the founding of the national banquet wine, to the diplomatic occasion of the banquet with wine, its "national wine" reputation has long gonein the wine industry researcher Ouyang Qianli, the brand is Maotai's core competitiveness, in other words, in the minds of consumers, "China's best white wine" awarenessthis recognition, giving Maotai wine unique market statusIn the liquor industry analyst Cai Xuefei, Maotai as China's high-end wine representative, in high-end business banquets, festival gifts level has a strong need and irreplaceablefollowed by scarce capacitydue to the complex production process, Maotai wine average production cycle of up to 5 years, that year's base wine, 4 years after the factory salesDebang Securities Research pointed out that in the past decade, Maotai wine base wine production compound growth rate of only 8%when strong brands and scarce capacity are combined, Maotai is actually a pure seller's marketIn other words, Maotai wine has a strong ability to raise prices, even if it has been rising, but also basically no worries about selling and strong ability to raise prices, reflected in financial data, turned into strong profitability This is why Maotai can achieve gross margin of more than 90%, net profit margin of more than 50% at the same time, Maotai can not only "eat meat" on their own, the channel can also follow the "drink soup" the current 53-degree Feitian Maotai factory price of 969 yuan / bottle, the official guide retail price is as high as 1499 yuan / bottle, and obviously in short supply, most of the time, consumers can buy hands of the end price has exceeded 2000 yuan / bottle Debang Securities Research Reported pointed out that in 2019, 53 degrees Feitian Maotai channel gross margin of 56%, five grain liquid five channel gross margin rate of 13%, old cellar 1573 channel gross margin of 16%, wine qinghua 20-year channel gross margin rate of 18% Maotai's channel profit margin is much higher than other high-end liquor lucrative channel profits, in fact, Maotai wine wide moat Debang Securities Research Reported pointed out that even in 2012-2015 high-end liquor has cut prices in the industry depth adjustment period, Maotai's factory price has not been affected Other high-end liquor ex-factory prices have seen a different range of decline The factory price of Grain Liquid fell by about 21% in 2013-2014 The ex-factory price of the old cellar in Zhangzhou fell by about 45% in 2013-14 static PE super 45 times, Maotai overrated? there is no doubt that the current valuation of Maotai is already in a historically high area at the closing price of 1494.27 yuan on July 1 and the basic earnings per share of 32.8 yuan in 2019, Maotai's current static PE has been more than 45 times, at the high level of the range in recent years horizontal comparison of wugrain liquid, Luzhou old cellar and other high-end liquor, Maotai has also appeared a large valuation premium however, if cross-category comparison condiment stoic (current static PE63 times) and hot pot tap sea floor fishing (current static PE67 times), as a liquor tap, and the fundamentals have been no where the Maotai is particularly cheap , is Maotai's current valuation reasonable? Or is it overrated? Or is it still underrated? In the view of Zhu Danpong, a Chinese food industry analyst, Maotai's share price is still reasonable It believes that, on the one hand, similar to other industry head companies, Maotai wine as the liquor industry boss, the stock price is certainly a riding dust On the other hand, this is also in line with the characteristics of capital greed, in the technology stocks, Internet stocks operating capacity in the existence of a great lack of uncertainty under the premise, we will all pursue some of the more stable industries to invest Ping An Securities in the research report pointed out that although Maotai's current static valuation is at a relatively high level in 10 years, but the standard overseas spirits Diageo, Maotai's growth is obviously better, and Maotai wine in China's high-end liquor in a unique position, the valuation should fully enjoy a premium also analysts believe that Maotai's valuation should be from the perspective of the large economic environment brand management experts, nine degrees consulting chairman Ma Fei believes that the current investors have a lot of money, no place to go, and liquor is a high-quality stocks, so a large number of domestic and foreign funds poured into liquor, as the wine industry's boss Maotai shares were pulled up is the reaction of the entire capital market, of course, but also pushed up the share price of famous wine Zhongtai Securities is in the "Buy Maotai, buy gold: the wealth allocation under the flood of paper money" article pointed out that Maotai's share price and the trend of gold prices have a strong correlation said that the annual supply of Maotai wine is very slow, will not suddenly increase production; So Maotai wine and gold characteristics are similar, can even be used as currency, a bottle of Maotai wine can be easily converted into cash ", Maotai produces more than just liquor, but is a 'currency' to some extent the next decade, can Maotai go any further? the past Maotai, is undoubtedly a model of value investment from the 2001 listing, to 2019, Maotai's revenue increased from 1.618 billion to 88.854 billion, a 54-fold increase, and net profit increased from 328 million to 41.206 billion, an increase of 125 times And in recent years still maintain a high rate of growth in recent years, the pattern of liquor industry is quietly changing after a "golden decade" in 2003-2012, a deep adjustment in 2013-2015, and a gradual restoration in 2016-2018, the output of liquor companies above the scale declined again in 2019 Many low- and middle-end liquor companies suddenly become less so good, golden seed wine even rare losses although take the high-end route and the moat wide Maotai is not affected, but the next decade, Maotai can go forward? Debang Securities in the research report pointed out that Maotai wine still has the ability to increase the volume of prices In terms of sales, Maotai wine is in a state of production decision sales, in the short term, it is expected that the compound growth rate of Maotai wine will be 5.9% in 2019-2022, and in the medium to long term, Maotai wine production will increase from 32,000 tons in 2018 to nearly 50,000 tons in 2024 Price, in Maotai retail price - factory price of the huge price difference and demand growth, relatively scarce production capacity background, in the long run, Maotai wine factory price has room to improve, short-term, directly put forward the probability of factory price is small, mainly by non-standard wine ratio increase and direct sales ratio to increase the increase ton price Guangfa Securities directly pointed out in the research report that the current Maotai wine price increase conditions are already in place, the second half of this year to the beginning of 2021 is a suitable price increase window period It said the company had not raised prices for more than two years since 2018, and that the channel profit margin for the past year was above 100 per cent, and that the price increase was expected to be 20 per cent if the channel profit margin was calculated below 100 per cent however, this does not mean that Maotai can rest easy high-end liquor is a relatively fixed circle, even if strong such as Maotai, is not born is the first high-end liquor, before that, five grain liquid, Shanxi liquor, etc have sat in this position in MaFei's view, in the long run, other high-end liquor brands and Maotai gap may gradually narrow, mainly because the development of Maotai by a variety of environmental impact is relatively large, especially Maotai's slow production growth, it is not possible to expand real estate in a timely manner, timely expansion also needtime, while the price is too high to look at is a good thing, is also a risk, everything has two sides in general, in the short term, Maotai's position is still solid, but the long-term competition, the end is far from over Source: Beijing