Backgammon (002251): Addition and Subtraction and the Way to Improve Efficiency
A dual-industry retail leader with Hunan as its core area.
The company has a super multi-advantaged area and industry-leading scale, with supermarkets and shopping malls / department stores as its main format.
①Region: Hunan has become a retail leader for 15 years, developed Jiangxi in 2005, opened Sichuan, Chongqing and Guangxi in 2013, and acquired Nancheng Department Store in 2014, becoming Guangxi’s No. 1, 1H19 acquisition of Changsha Jiarunduo; ② format: as of 2019.
06, 329 supermarkets, 52 department stores, construction area of 4.49 million square meters; 2018 and 1-3Q19 revenue of 18.5 billion and 14.8 billion yuan respectively, of which supermarkets (including household appliances) accounted for 70% of the main revenue.
Strategic focus, both subtraction and addition.
① In recent years, due to the expansion of Sichuan and Chongqing, expansion of e-commerce, heavy capital expansion of commercial real estate and sideline businesses, the net interest rate in 2016-18 was not more than 1%.
② Do subtraction and baggage removal: strategic forecasting and adjustment since 2018, optimizing management structure, replacing e-commerce and invalid sideline businesses, and promoting REITS. It is not expected to continue to withdraw from weak areas and invalid businesses, so as to reduce losses and stop losses, and optimize asset structure; ③Addition, focus on advantageous areas and core business: young team, yield resource optimization mechanism, strategic focus on Hunan, Jiangxi, Guangxi and other advantageous areas, with supermarkets as the supplementary and efficient expansion of shopping plazas, deepening and strengthening;We have estimated that the supermarket market space in Hunan Province is 21.5 billion to 28.5 billion. It is expected that the company will focus on strengthening Changsha and sinking counties on the basis of consolidating the advantages of prefecture-level cities in the future.
Supply chain and digital upgrades to ensure medium-term efficiency growth.
① Supply chain: Promote the S2B2b2C model, integrate business with production, strengthen the incentives for the connection between procurement and sales, and direct harvesting of fresh produce bases; ② Digitization: After six years of e-commerce exploration and accumulated rich experience, we started to join hands with Tencent and Jingdong in 2018Promote the transformation of smart retail; 13 million digital marketing members 杭州桑拿 in 1H19, accounting for 71% of sales, and monthly repurchase of members increased by 30%; develop digital products, enable operational conversion, and test the effectiveness of human resources, floor efficiency, gross profit and loss control of pilot storesWith the improvement, financial effects gradually appear.
③ There is a lot of room for efficiency improvement: the company’s human efficiency in 2018 was 640,000 yuan / person (Yonghui 740,000 yuan / person) for five consecutive years, and the supermarket ping efficiency was only about 6000 yuan / square meter (Yonghui Supermarket).
20,000 yuan / square meter), net interest rate is 0.
84% (Yonghui Store 3.
Profit forecast and estimation.
It is expected that the net profit attributable to mothers will be 1 in 2019-21.
6.7 billion / 2.
42 billion / 3.
1.5 billion, an annual increase of 7.
5% / 45.
0% / 30.
Considering that the company vigorously promotes the transformation of the supply chain and digital transformation in 2019, focusing on the main business and core areas of strength, driving the inflection point of flexibility and growth potential, referring to peer valuations, it is given 0 in 2020.
5 times PS, reasonable value range 10.
7 yuan, “continuous market” rating.
Risk warning: market competition intensifies; uncertainties in the progress and magnitude of loss reduction by external provinces; prolonged risks during the cultivation period; and continued pressure on capital expenditures.