Yili shares (600887) in-depth tracking report: 2020 Yili investment value from the review of the last round of raw milk cycle

Yili shares (600887) in-depth tracking report: 2020 Yili investment value from the review of the last round of raw milk cycle

It is expected that the price of dairy products will increase in 2020, and industry competition will improve. Yiliwang will introduce competitive advantages such as milk sources, brands, and channels to accelerate the grab of shares, improve product structure, and gradually realize the existing flexibility.And long-term large space, maintain the “Buy” rating, raise the target price to 38 yuan.

In-depth review: In the last round of raw milk cycle, Yili’s two waves doubled investment opportunities.

① From November 2012 to September 2013, the merger increased by 127%.

Raw milk has grown moderately, the competitive landscape has eased, the company’s product structure has increased rapidly, it has continued to grab share, and its profitability has improved against the trend.

② From June 2014 to May 2015, the merger increased by 90%.

The three major factors resonate-the cost of raw milk continues to fall, the price increase effect appears, the structure continues to upgrade, and the company’s performance for four consecutive quarters exceeds expectations.

The core reason for the double-wave Davis double-click is that the company’s strong pricing power through the development of comprehensive capabilities such as brands and channels has enabled the company to better control costs during the raw milk price cycle, accelerate structural upgrades, and increase prices indirectly or directly.Realize rapid income growth and performance flexibility.

Pre-judgment of milk price: The growth trend will continue in 2020, and the growth rate may be improved.

On the demand side, the growth rate of the dairy industry in 2020 will be an appropriate replacement under a high base, but it will still continue to grow through consumption upgrades to tap the low-end market. It is expected that the overall upstream demand will also decrease.

On the supply side, the milk price has increased faster than expected in 2019 and is mainly affected by factors such as environmental protection, pig prices, and trade disputes. The above factors are expected to ease in 2020.

It is expected that the inventory is expected to stabilize and rebound. According to a comprehensive calculation, the raw milk supply will increase by 10% in 2020, and the raw milk supply and demand gap will narrow quarter by quarter.

Combined with a comprehensive analysis of supply and demand, it is determined that the price of milk will continue to increase in 2020, but the growth rate may appear, showing the characteristics of high and low, and it is expected to enter a stable range in 2021.

Optimistic about Yili’s investment opportunities in 2020.

Under the background of tightly balanced raw milk and continued price rise, Yili is expected to become a strong brand, with channels and raw milk control, to continue to grab share and improve product structure to achieve both volume and price increases; industry competition under the pressure of raw milk is gradually easing.The company’s profitability is expected to remain stable against the trend.

Raw milk pressure will decline seasonally from 2020-2021. When milk prices stabilize or peak at 2020H2-2021H1, Yili will enjoy the advantage of leading 重庆耍耍网 pricing power. The improvement in gross sales gap will bring obvious performance elasticity.

The company’s equity incentives lock in the bottom line performance growth rate, high ROE and high cash dividend ratio; at the same time, it hopes to motivate the management team to continuously improve performance and achieve the long-term strategic goals of the health food industry group.

Risk factors: risk of sluggish demand for dairy products, risk of industry competition exceeding expectations, and food safety risks.

Investment suggestion: The company has deep barriers and the consolidation of leading companies has been consolidated.

Considering that the profit elasticity of 2020H2 and 2021 will gradually appear, we raise the company’s EPS to 1 in 2019-2021.



51 yuan (originally 1.



41 yuan), maintain the “buy” rating, raise the target price to 38 yuan, corresponding to PE in 2021 is 25 times.