Baby-friendly Room (603214): The expansion of the expansion of the mother-to-child chain leader in East China has accelerated

Baby-friendly Room (603214): The expansion of the expansion of the mother-to-child chain leader in East China has accelerated

Investment points: After more than 20 years of deep cultivation, the company has become a leading mother and infant company in East China, positioned in the mid-to-high-end market, with steady expansion of direct-operated stores, multi-channel and multi-mode synergy; after listing, it gradually enhances its capital 佛山桑拿网 advantage, accelerates the pace of extension and gradually consolidates the Yangtze River DeltaThe mother-to-child market leadership system strengthens the development of the economically developed areas in East China horizontally, and enters the Southwest and other markets in a timely manner to gradually achieve comprehensive coverage of the domestic economically developed areas.

  East China mother and infant leader, full of motivation.

① Listed on the Shanghai Stock Exchange on March 30, 2018, and terminated 223 main stores at the end of December, covering 10 cities in 4 provinces: Jiangsu, Zhejiang, Shanghai, and Fujian.

Revenue in 2018 21.

3.5 billion, net profit attributable to mother 1.

200 million, CAGR of 2013-18 revenue and net profit of 16 each.

4% and 22.

3%.

② Shi Qiong, Mo Ruiqiang, Qi Jiwei and 深圳spa会所 Dong Qincun are joint actual controllers, holding a total of 40 shares.

25%; the 5th largest shareholder, Mao Qiang Investment, appoints Dong Gao Jian and its core business backbone; plans to launch the 2019 annual stock incentive plan, with sufficient associated shareholding + equity incentives, which will help motivate employees and demonstrate the company’s confidence in medium and long-term performance.

  Industry: The mother and infant market has huge potential and the competitive landscape is scattered.

① Consumption upgrade supplements rigid demand, and the mother and infant market has huge potential. According to the Children’s Industry Research Center, the mother and infant industry size reached 2 in 2017.

59 trillion, expected to exceed 3 trillion in 2018.

② Online channels are developing rapidly, and offline is still the main force channel. Franchised stores are easily trusted by consumers. According to iResearch, the market share of maternal and infant franchise stores in 2018 will account for 51% of offline channels.

③ One of the one-stop maternal and infant product chain retail markets has regional characteristics and has not yet emerged as a national leader. Regional leaders have appeared in some economically developed regions, and there is ample room for integration and development.

  Stores: Crypto East China expands South China and adjusts its layout to increase growth space.

Focusing on the economically developed areas of East China, the company has steadily strengthened Jiangsu, Zhejiang, Shanghai, and other places. In 2016-18, it opened 37, 33, and 45 new stores each. As of the end of 2018, it has 223 directly operated stores and 13 in total.

50,000 square meters, and plans to gradually open up new markets in the southwest based on Chongqing; gradually, actively adjust store types, close street stores, and open more profitable malls. As of the end of 2018, 70% of the company’s stores are open to large-scale shopping. In the mall.

In addition, the store’s regular antique parent-child activities and mother-baby talks enhance consumer experience and increase consumer stickiness.

  Products: Increase the proportion of direct supply, and develop our own brands.

① Procurement: Focus on centralized procurement, supplemented by regional procurement, increase bargaining power, and increase the direct supply ratio, effectively reduce costs and increase the company’s profitability.

② Warehouse distribution: Zhejiang Jiashan self-built logistics distribution center. Suppliers deliver products to stores in batches to reduce distribution costs. ③ Own brands: The company’s own brands are mainly concentrated in infant clothing, diapers, lotions, etc., 2018It reaches 1 at the beginning of each year.

78 ‰, an increase of 29% in ten years, accounting for 8 of merchandise sales.

9%, the proportion continues to increase.

  Channel: Online and offline integration and advancement, omni-channel enhancement of customer stickiness.

As an auxiliary means to support store sales, the e-commerce platform provides consumers with an information sharing platform in addition to store drainage, which is conducive to building a network of mother-to-child users and further understanding customer needs.

In 2018, the company increased its investment in e-commerce, added scene experience projects such as parent-child activities in the APP mall, and launched new services such as group fights, self-collection at the store, and WeChat mini-program exchange points, optimizing the platform, enhancing interaction, and improvingshopping experience.

  Profit forecast and estimation.

It is expected to earn 25 in 2019-21.

8, 30.

5 and 35.

80,000 yuan, an annual increase of 20.

9%, 18% and 17.

7%, net profit attributable to mother 1.

5, 1.

86 and 2.

29 trillion, an increase of 25% in ten years, 23.

7% and 23.5%, earnings per share 1.

5, 1.

86 and 2.

29 yuan.

With reference to maternal and infant and other comparable companies, it will grant 30-35 times PE in 2019, corresponding to a reasonable value range of 45-52.

5 yuan, for the first time covering the investment rating given to the “previous market”.

  Risk warnings: Store rents are rising; new store cultivation is less than expected; industry competition is intensifying.