Morningstar

Anhui Yingjia Distillery Co Ltd Class A 603198

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Stock XSHG Rating as of
¥72.92 +6.63 (10.00%)
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As of Delayed Price Closed

Company Report

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Robust Demand and Cost Efficiency Drive Strong Growth of Anhui Yingjia

Jennifer Song

Anhui Yingjia is one of the four “Golden Flowers” in the Anhui local baijiu market, and it produces rich-flavored baijiu with a strong focus on mainstream products. Despite a weaker brand heritage, the company has gained a reputation as one of the few natural and organic baijiu producers in the industry, successfully launching its higher-end flagship product Dongcang Yearly in 2015. This allows the company to upgrade its product mix and capture the solid premiumization trend in Anhui, and generate economic profits well into the future, in our view.

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Price vs Fair Value

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603198 is trading at a 49% premium.
Price
¥72.92
Fair Value
¥46.00
Uncertainty
High
1-Star Price
¥264.30
5-Star Price
¥18.80
Economic Moat
Bmxkdc
Capital Allocation
Cjpmsdzs

Bulls Say, Bears Say

Bulls

Premiumization is a long-term tailwind for Yingjia, leading to stronger sales of higher-end products and widening profit margins.

Bears

Anhui has been the most competitive baijiu market in China, and intensifying competition may lead to higher selling costs and lower profit margins at Yingjia.

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Trading Information

Previous Close Price
¥66.29
Day Range
¥67.04–72.92
52-Week Range
¥46.60–80.97
Bid/Ask
¥72.92 / ¥0.00
Market Cap
¥58.34 Bil
Volume/Avg
8.9 Mil / 4.8 Mil

Key Statistics

Price/Earnings (Normalized)
22.73
Price/Sales
7.93
Dividend Yield (Trailing)
1.78%
Dividend Yield (Forward)
1.78%
Total Yield
1.78%

Company Profile

Anhui Yingjia, or Yingjia, is the second-largest baijiu distiller in Anhui province by sales revenue in 2023. The company produces rich-flavored baijiu, and it is one of the well-known brands in the mainstream market in Anhui and its surrounding provinces. Its flagship product, the Dongcang Yearly series, contributed about 45% of company sales in 2023. Yingjia is 72% held by Anhui Yingjia Group, following a management buyout in 1997, so ownership comprises mainly Yingjia’s management and core employees.
Sector
Consumer Defensive
Industry
Beverages - Wineries & Distilleries
Stock Style Box
Large Growth
Total Number of Employees
7,406
Website
http://www.yingjia.cn

Competitors

Valuation

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Metric
603198
000568
000596
Price/Earnings (Normalized)
 22.7315.2719.92
Price/Book Value
 6.735.274.72
Price/Sales
 7.936.754.72
Price/Cash Flow
 21.1114.5214.63
Price/Earnings
603198
000568
000596

Financial Strength

Metric
603198
000568
000596
Quick Ratio
 1.322.351.45
Current Ratio
 3.403.092.10
Interest Coverage
 114.1738.201,206.00
Quick Ratio
603198
000568
000596

Profitability

Metric
603198
000568
000596
Return on Assets (Normalized)
 23.65%21.69%14.96%
Return on Equity (Normalized)
 31.95%35.77%24.88%
Return on Invested Capital (Normalized)
 32.03%26.67%22.48%
Return on Assets
603198
000568
000596

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