Running all the way-Yili shares

Most people believe that taking too big steps is easy to pull eggs. But everyone hopes that the companies they invest in will flourish and make great strides forward.

How to distinguish "striding meteor" from "striding too far"?

I have repeatedly read the annual report of Yili, and I have this question. With this question, let's analyze it together. If there is anything inappropriate, I hope you can point it out and discuss it together. First draw a conclusion: Yili shares are better than Mengniu Dairy, the biggest competitor, and its growth potential is still huge.

The article is divided into three parts:

1, the growth of Yili Dairy;

2. The management basis of the enterprise;

3. Are these four phenomena ominous?

4. Summary

The text begins.

First, the growth of Yili Dairy

In the business world, many competitors have achieved common success. We are familiar with Coca-Cola and Pepsi, KFC and McDonald's, as well as Yili and Mengniu Dairy. There are two kinds of enterprises worthy of long-term investment. The first type: this company has no rivals in its main industries, such as Tencent and Didi.

Second: this company is always a little better than the biggest competitor in the industry. Imagine that feeling, the two companies are very similar, and even their products are sold together! However, when you read their financial reports, you will obviously feel that one of them is better.

We believe that Yili shares belong to the second type of enterprises. Everyone knows that there are two giants in china dairy: Yili and Mengniu. Then let's compare the growth of these two companies.

1, income and profit, as shown in the following table:

In 20 16, the income gap between Yili and Mengniu Dairy was 6.8 billion, which has reached 20.8 billion after the epidemic in 2020. Mengniu Dairy's gross profit margin is higher than Yili's, but the net profit attributable to the parent company is twice as small as Yili's! From 20 15 to 2020, the compound annual growth rate of operating income will be 8.2 1% for Yili and 7.59% for Mengniu Dairy.

Similarly, from 2065,438+05 to 2065,438+09, the compound annual growth rate of net profit attributable to the parent company was 7.32% for Yili, 65,438+065,438+0.64% for Mengniu Dairy and 6.86% for 2020.

Excluding the epidemic, the compound growth rate of Mengniu Dairy's net profit is higher than Yili's, and its gross profit margin is also better than Yili's. However, the gap of operating income is getting bigger and bigger, which leads to the gap of net profit from 2.265 billion in 20 15 to 3.553 billion in 2020, with a compound annual growth rate of 7.53%.

Inferred from the data of these six years, Yili shares will maintain a more stable growth than Mengniu Dairy in the future. Because, in 20 19, the per capita consumption of dairy products in China is equivalent to 35.8 kilograms of raw milk; According to the data of USDA, the per capita consumption of dairy products in the United States in 20 19 years is about106 kg; According to the statistics of the Japanese Ministry of Agriculture, Forestry and Fisheries, the per capita consumption of dairy products in Japan in 20 19 was 95.4 kg; The per capita consumption of dairy products in China still has a lot of room for improvement. Therefore, the growth potential of dairy giants is still relatively large.

2. Comparison between products

The gross profit margin data of three product lines of Mengniu Dairy can't be found in the annual report. Among them, the decrease in the milk powder business income of Mengniu Dairy in 2020 is caused by the sale of Junlebao. We can clearly see that Yili shares are obviously ahead of Mengniu Dairy in every product line. Especially for the two product lines of cold drinks and milk powder, the income gap has more than doubled (the sum of the two products leads11900 million yuan). Especially in the cold drink industry, the compound annual growth rate of Yili shares has reached 7%, but Mengniu Dairy has been standing for six years.

Judging from the above table, it is debatable whether the milk powder business is a good business. However, at present, after China's national self-confidence is enhanced in 2020, He Fei's milk powder will rise strongly, surpassing Nestle 17.2% market share to get the first place. So the golden understanding of Yili shares will not erode the market share of more foreign brands? And recently, the central media has been promoting domestic milk powder.

Generally speaking, we believe that Yili shares have developed very well in cold drinks and milk powder business while grasping the main business of liquid milk. The gap between Mengniu Dairy and Yili in these two businesses is getting bigger and bigger.

3. Construction in progress and fixed assets

From 20 19, the investment of the two companies in their own hardware began to widen the gap. At present, Yili shares have more investment ability than Mengniu Dairy. Judging from the projects under construction, Yili shares are more optimistic about the future. Mengniu dairy industry is more conservative.

Then, Yili shares are twice as many as Mengniu Dairy's projects under construction. Is this reasonable? At present, the operating income of Yili is about 1.27 times that of Mengniu Dairy, and the profit gap doubles. If we first look at the figure that the revenue gap between the two companies reaches 20 billion, and then look at the investment amount of the projects under construction of the two companies, we will feel much more reasonable.

4. Is it necessary to raise 654.38+03 billion yuan?

Let's look at the projects that need investment (unit: 10,000 yuan)

The investment in liquid milk is 8.9 billion, accounting for 49.34% of the total investment, and the investment in milk powder is 210.20 billion, accounting for10/%of the total investment. Liquid milk is 5.9 times the revenue of milk powder, and the input is 4.2 times. At present, in the projects under construction, the liquid milk budget is11500 million, and the completion progress is 77.4 1%. The budget of the milk powder project under construction is 210.38 billion, and the completion progress is 36. 1. 1%. The cost of liquid milk under construction is 5.38 times that of milk powder under construction. At present, the impact of mineral water project on income is too small. I went to several supermarkets nearby, but I didn't find Yike Huoquan and Yiran.

According to the investment scale of the projects under construction of Yili, the amount of RMB 654.38+0.3 billion to be invested in liquid milk and milk powder projects is not much different. We estimate that after all the new liquid milk and milk powder projects are put into production, the new liquid milk production capacity will be 2244020 tons/year. In 2020, the output of Yili liquid milk will be 886 1824 tons. This is equivalent to an increase in production capacity of 25%. The new capacity of milk powder is 36,500 tons. In 2020, the output of milk powder was 223,464 tons, up 16.3% year-on-year. If the epidemic situation is excluded, the compound annual growth rate of liquid milk in Yili is about 10%. Excluding the influence of the newly acquired westland dairy industry, the compound annual growth rate of milk powder is about 10%. These new capacity can be digested.

We believe that "digital transformation and information upgrading project" is very necessary, and enterprises can achieve more refined and scientific management, production and sales through digital transformation. If you don't do it now, you will fall behind more and more in the future.

The biggest doubt is that the dividend amount of Yili shares in 2020 is 4.988 billion, accounting for 70.47% of the net profit attributable to ordinary shareholders of listed companies in the consolidated statements. Why doesn't the company choose to reinvest with less dividends? Instead, choose a non-public offering to raise funds? Is this a roundabout way to increase the shareholding ratio of some people? From another point of view, if this is the case, it is actually beneficial to the long-term development of the company.

Second, the business foundation of the enterprise

Now look at the operating data of Yili shares through financial reports.

1. Debt repayment ability (unit: 100 million)

Judging from the current data, the company has certain debt repayment pressure. The company's largest RMB 3.262 billion dollar bond will not expire until 2025. It is calculated that the short-term interest-bearing debt in 2020 is about 654.38+00.289 billion. The pressure is still great. From this perspective, corporate financing is necessary. However, the financial cost of Yili shares is not high, and the sudden increase this year is caused by exchange losses.

The total dividends of Yili shares in 20 18, 20 19 and 2020 are1465438+56 million yuan, accounting for 69.25438+0% of the net profit attributable to ordinary shareholders of listed companies. Why not use it to reduce debt? Like many other companies, the dividend is 30%, and the remaining 8.02 billion yuan is used to pay off debts, so I think it is in the interests of the majority of small and medium shareholders of the company.

The company issued $500 million in bonds, if the $500 million is converted into RMB. Moreover, the RMB should appreciate against the US dollar for a long time. So will you still make money in five years? I'm imagining.

Summary: the debt pressure of Yili shares is still relatively large. The debt pressure of Mengniu Dairy is actually greater than that of Yili. The total amount of interest-bearing bank and other loans in the annual report is 6543.8+08.752 billion in 2020 and 23.655 billion in 2065.438+09. Mengniu's cash and bank balance is1139.7 billion, which is similar to Yili.

2. Bird's-eye view of cash flow statement (unit: 100 million)

The basic operating conditions of the company should be good. However, the ending balance of cash and equivalents has been declining for three consecutive years. In 2020, the net cash flow of financing activities is only -0.47 billion, and it is accompanied by the increase of debt. The money borrowed from 20 17 is not only spent, but there will be more and more debts by 2020. It seems that it is really necessary to raise 3.86 billion yuan to supplement the working capital and repay the bank loan project.

Through the comparison of the above tables, we can intuitively see that Yili shares are obviously superior to Mengniu Dairy. The investment in the past seven years is about 3 billion less than that of Mengniu Dairy. The net financing is that Yili's net expenditure is close to 20 billion, and Mengniu Dairy's net income is110/630,000, one is milking cows. In the past three years, the difference between net cash flows from operating activities has been increasing.

Summary: The company is in good operating condition, but the investment is increasing, resulting in more and more liabilities. Cash flow is tight. But it is much better than Mengniu Dairy.

3. Basic data of operational capacity

On the whole, Yili shares are better than Mengniu Dairy, and Yili shares can use other people's money to develop themselves. Only the inventory turnover days are slightly worse than Mengniu Dairy. Judging from the data of these seven years, the operation of Yili shares has remained stable. Moreover, it is better than their biggest competitor.

3. Are these four phenomena ominous?

When reading the annual report of Yili, we found four unexplained phenomena. Now I'll take them out and discuss them with you.

1. Why is the proportion of bad debts reduced?

We found that in 2020, in the second item of accounts receivable portfolio accrual, the accrual ratio was 3.73% within 3 months, 7.96% within 4-6 months, 23.58% within 7- 12 months, and 1 00% above1year. However, in 20 19 years, the corresponding accrual ratios are 7.74%, 16.43%, 4 1.33% and 100% respectively. I remember the teacher's book in the Tang Dynasty said that "there must be a demon behind everything", especially when the company changed the bad debt ratio.

According to the standard of 20 19, the bad debt loss of accounts receivable in 2020 should be1400,000.

The interest rate of borrowing has gone up.

Summarizing the ultra-short-term financing bonds issued by Yili in 2020, the 30-day interest rate is generally around 1.6%. But by 202 1, the 30-day interest rate reached about 2.2%. The company's cash reserve1143.4 billion yuan, but the borrowing interest rate has been rising, which is meaningless.

3. The relationship between loans and micro-loans and factoring.

Among other current assets, non-current assets due within one year and other non-current assets, we sort out micro-loans and factoring. Among them, the total amount of small loans will increase from132.9 billion in 20 19 years to 311400 million in 2020. Factoring will increase from 26,543,849 million in 2065,438+09 to 3,585 million in 2020. The sum of these two items increased from 3.478 billion in 20 19 to 6.699 billion in 2020, an increase of 3.225438+0 billion yuan.

The company's short-term loans increased from 4.56 billion in 20 19 to 6.957 billion in 2020. Moreover, Ultrashort Finance has been issued for 36 issues. We want to know whether short-term loans and ultra-short financing have a strong relationship with micro-loans and factoring provided by the company in the upstream and downstream industrial chain. We are a little worried about whether the company will have short-term loans and long-term investments, which is actually a bit dangerous.

4. Why did you invest in several investment fund companies?

In 2020, the company invested 6543.8+925 million yuan in PAG Asia Consumer Co., Ltd., and previously invested in a number of investment fund companies. What we don't understand is that the company is engaged in dairy products. Why should we invest in a company that has nothing to do with its main business?

Fourth, summary.

It's hard to say who is good or bad on the product, but Yili's milk powder is much better than Mengniu Dairy. Mengniu's pasteurized milk is better than Yili's. No convenience store, supermarket or box horse near me sells Yili's pasteurized milk. Originally, I wanted to taste all the products of Mengniu and Yili before making comments. However, after I drank it ... I found that there was not much difference.

Again, we think there are two kinds of enterprises worth investing in for a long time. The first type: this company has no rivals in its main industries, such as Tencent and Didi. Second: this company is always a little better than the biggest competitor in the industry. Yili shares belong to the second kind of enterprise, but through the analysis of our whole article, it is found that Yili shares are actually a big step for Mengniu Dairy simply from the annual report.