Zhongshun Jierou (002511) commented on major issues: Bamboo pulp-paper integration consolidates long-term growth

Zhongshun Jierou (002511) commented on major issues: “Bamboo pulp-paper integration” consolidates long-term growth

The new round of employee stock ownership plan was implemented, and the core management team was fully motivated.

The bamboo pulp and paper integration project builds a “Jierou” and “Sun” dual-brand strategy, and has long exceeded the industry’s tens of billions in revenue growth.

Matters: 1) The company announced that it intends to construct 30 bamboo pulp and paper integration projects in Dazhou City, Sichuan Province, with a total construction period of 70 months and a total investment of 40.

87 trillion, the project includes an annual production capacity of 31.

8-inch bamboo pulp production line and 30-inch tissue paper production line; 2) The company announced a new round of employee shareholding plans (expenses), plans to raise funds to a maximum of 5,000 million, and established an asset management plan to be transferred and repurchasedShares repurchased by special accounts.

Our comments are as follows: The integration of bamboo pulp and paper is expected to open up the growth space of tissue paper business.

The main raw material of household paper is wood pulp. The cost of pulp accounts for about 60% of the production cost and the company’s raw materials all rely on imports.

The efforts of the Bamboo Pulp and Paper Integration Project promote the improvement of the company’s raw material self-sufficiency rate and reduce the impact of exchange and pulp price changes on corporate profits.

The investment amount of Dazhou project pulp production line is 17.

80 million, plans to complete construction within three years; investment in paper production line is 21.

12 ppm, to be constructed in three phases, with a short-term capacity of 10 in each phase.

With the advancement of the integration of bamboo pulp and paper, the company will launch the “sun” brand bamboo-wood mixed paper to strengthen its penetration of products in the low-end price band and seize the market share of small and medium-sized brands based on the advantages of existing channels.

The differentiated positioning of “Jierou” and “Sun” is conducive to the company’s product portfolio. While enlarging the effect of scale, it has broken through the growth rate of tens of billions of paper revenue of a single enterprise.

A new round of employee shareholdings was implemented, and interests were deeply bound.

The company’s first phase of employee shareholding (28.31 million shares) has been sold and terminated. It is now planned to issue a second phase of employee shareholding plan with a maximum funding of 50 million yuan and establish an asset management plan.Of shares (cost price 8.

08 yuan / share, a discount of 32% from the current price, the scale does not exceed 11.71 million shares)

The total number of participants in this round does not exceed 80. Among them, 9 of Dong Jiangao’s subscription share is expected to account for 56%. The core professional managers Liu Jinfeng and Zhou Qichao are deeply bound. The management team is stable.

The company has adopted multiple rounds of incentive measures since 2015. Among them, the equity incentive plan at the end of 2018 covered 81% of the total number of employees. Consistent benefits from top to 北京桑拿 bottom have driven the company’s performance to continue to grow rapidly.

The pulp price fell more than expected, and the gross profit margin resumed to release performance elasticity.

After entering the second quarter, the decline in pulp prices has continued to expand, and has fallen by 20% year-to-date.

Sluggish demand, high inventory, and additional currency depreciation pressure, judging that pulp prices are still under downward pressure in the short term.

However, the supply continues to shrink upstream, and it is expected that pulp prices will bottom out in the second half of the year.

Assume exchange rate 6.

9. The price of pulp in the outer plate fell by 8%. Considering the potential channel profit, it is expected that the gross profit margin in 2019 will promote repair to 36.

5%, an increase of 2 per 佛山桑拿网 year.

44pcts, bring short-term performance flexibility to the company.

Category expansion and the rise of emerging channels are favorable for long-term development.

The company’s high-margin products “face + lotion + natural wood” accounted for over 65% of its revenue in 19Q1 and is expected to increase to 70%.

The product structure upgrade continues, and it is estimated that the proportion of non-roll paper business in 2019-2021 will be 63.

3% / 64.

1% / 65.

9%, remaining margin of upside in gross profit margin; personal protection business expansion follows new channels, new selling points, and gradually develops the full product matrix, new brands still have breakthrough potential; emerging channels continue to release channel dividends, and it is expected that e-commerce + commerce in 2019-2021The proportion of sales channels will reach 36% / 44% / 51%. The rise of emerging channels not only facilitates the launch of new products, but also strengthens the company’s control over channel and product terminal prices.

Long-term development is worth looking forward to.

Risk factors: fluctuations in raw material prices; new product sales, channel expansion, and capacity releases are less than expected.

Profit forecast, evaluation and rating.

The downside of pulp prices exceeded expectations, bringing performance flexibility; high revenue growth in e-commerce and commercial sales channels continued to release channel dividends; breakthroughs in breakthrough income from the “Bamboo pulp integration” project and personal care product development.

Maintain 2019-2021 EPS forecast to 0.


61 yuan, maintain “Buy” rating.