Shengnong Development (002299): Improve the incentive mechanism, industry leaders can increase steadily

Shengnong Development (002299): Improve the incentive mechanism, industry leaders can increase steadily

Event On November 21, 2019, the company issued the “Fujian Shengnong Development Co., Ltd. 2019 Stock Expansion Incentive Plan 四川耍耍网 (Budget)”. This incentive plan can only be implemented after being approved by the company’s shareholder meeting.

  Our analysis and judgment will launch the stock incentive plan, and the incentive mechanism will be further improved. The number of additional stocks proposed by the company to launch the incentive plan is 546.

210,000 shares, accounting for 0 of the company’s share capital at the time of the announcement.

441%.

Among them, 491 was awarded for the first time.

59 million shares, 54 in ten years.

620,000 shares.

The maximum grant price for the first share award is up to 13.

57 yuan.

The incentive objects are always 235 directors, senior managers, middle managers and core technical (business) personnel serving in the company and its subsidiaries.

  The first year of this latest incentive plan for the granting of supplementary stocks will be released from 2019-2022, and the four fiscal years will be reduced by 100 in three years from 2016 to 2018.

1.5 billion is the base, and the operating income reduction in 2019-2022 is not less than 25%, 31%, 38%, 45%, corresponding to the revenue of 2019-2022 is not less than 125.

19, 131.

20, 138.

21, 145.

2.2 billion.

The IPO will promote the further improvement of the company’s incentive and restraint mechanism, fully mobilize the enthusiasm of core personnel, and promote the steady growth of the company’s performance.

  The industry is booming, and the company’s performance has increased significantly from January to October 2019. Due to the tight supply of chicken meat and the demand substitution, the industry boom continues to rise, and the prices of broiler chickens and chicken products continue to rise and remain high.

According to Boya and News data, the price of white feather broiler chicken in Q1 2019 is 9.

53 yuan / kg, an increase of 18 in ten years.

24%, the comprehensive price of chicken products 11.

94 yuan / kg, an increase of 20 in ten years.

36%.

The company has the advantages of integrating and integrating the entire industrial chain. The net profit attributable to the parent in Q1 2019 is 27.

50,000 yuan, an increase of 248 in ten years.

33%.

October the company sells chicken 8.

13 digits, reduced by 0 every year.

82%, realized income 11.

69 ppm, an increase of 28 in ten years.

15%.

  Chicken prices fell in November, but remained at a high level, and will still run at a high level in the later period. According to Boya and News data, the price of chickens reached 13 in October.

After a high of 12 yuan / kg, it fell back to 9 in the second week of November.

91 yuan / kg, the comprehensive price of chicken products is also from 17.

The high point of 30 yuan / kg dropped to 14.

00 yuan / kg.

The lower limit is due to the reduction in consumption after the pig price exceeds 40 yuan / kg, and the decline in pig prices, and the decline in chicken prices; the purchase of high-priced chicken by traders should be reduced to the staged demand for chickendecline.
  Looking ahead, we believe that chicken prices have improved in the short term, but due to the increase in demand before the Spring Festival, prices still have room to repair; at the same time, the reduction in hog supply is difficult to improve quickly in the short term, and the sow inventory can continue to rise, but the hog supplyRecovery still takes time. As a major substitute for domestic animal protein consumption, chicken is expected to maintain a high level of consumption in 2020.Considering the liberalization of domestic imports from the United States, imported chicken meat supplements the feed. It is expected that chicken meat supply and demand will remain strong in 2020.

  Investment suggestion: We expect the company’s operating income to be 143 in 2019-2020.

03 ppm and 160.

42 ppm, an increase of 23 per year.

87% and 12.

16%; net profit is 37.

46 ppm and 38.

44 ppm, with annual growth of 148.

82% and 2.

63%, corresponding P / E is 8 respectively.

2x and 8.

0x, maintaining the “overweight” level.

  Risk reminder: chicken meat price fluctuation risk; raw material price fluctuation risk; risk of epidemic disease.