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Si Wen Zhang

Zhang Siwen of investor.com

The share price of leading companies in the stationery industry has fallen intermittently for eight months, and the market value has shrunk from 80.2 billion yuan on July 1 last year to 48.5 billion yuan on March 3 this year.

In fact, since the release of the “double reduction” policy in July last year, listed companies in the office supplies industry have been under the dual pressure of performance and stock price. As a leader in the industry, Shanghai Chenguang Stationery Co., Ltd. (hereinafter referred to as “Chenguang stationery”, 603889. SH) is facing more obvious stock price pressure.

According to wind statistics, from July 1 last year to March 3 this year, the office supplies index fell by 33.83%, while Chenguang stationery fell by 38.16%; The overall performance of this industry was significantly weaker than the 12.59% decline of the Shanghai and Shenzhen 300 index in the same period.

01

“Stagnation” of traditional business growth

There is a market view that the “double reduction” policy has had a great impact on the company’s performance.

According to wind data, the operating revenue of Chenguang stationery in the third quarter of 2021 was 4.465 billion yuan, a year-on-year increase of 18.25%, which was significantly slower than that in the first two quarters of last year; In the same period, the net profit attributable to the parent company hardly increased, and only 451 million yuan was obtained in the third quarter, a slight increase of 0.57% year-on-year.

Moreover, the growth of traditional business of Chenguang stationery in the third quarter of last year was almost stagnant, and the revenue increased by only 1%.

Southwest Securities Research Report shows that after excluding Chenguang technology, Chenguang stationery achieved a revenue of 6.05 billion yuan in the first three quarters of 2021, an increase of 23%; In the third quarter, the revenue in a single quarter was 2.2 billion yuan, an increase of 1%. The agency believes that the slowdown is mainly due to the high base in the same period last year and the double reduction policy.

Chenguang technology refers to Shanghai Chenguang Information Technology Co., Ltd., a subsidiary of Chenguang stationery holding 55%. Its main business is divided into tmall and jd.com, which is responsible for online full platform marketing and authorized store management; In the first three quarters of 2021, the operating revenue was nearly 400 million yuan, with a year-on-year increase of 16.87%.

In addition to the policy impact, Huaxi Securities believes that the epidemic is also one of the factors affecting the company’s performance: “in the second half of last year, under the influence of the double reduction policy, the continuous repetition of the epidemic, the rise of raw materials and the high base in the same period last year, the company’s traditional stationery business was under short pressure.”

However, the impact of “double reduction” on Chenguang stationery may be greater in the fourth quarter of last year.

This is because the National People’s Congress said in October last year that the double reduction plan is to be clearly incorporated into the law to avoid increasing the burden on students in the stage of compulsory education. The impact of the “double reduction policy” on the “student stationery”, the second largest source of income of the company, has not been reflected.

In the first three quarters of 2021, the income of student stationery occupied an important position, contributing nearly 2.4 billion yuan, accounting for 19.57%, ranking second.

In addition, writing instruments contributed 2.373 billion yuan of revenue in the same period, accounting for 19.53%, and office stationery contributed 2.08 billion yuan of operating revenue in the same period, accounting for 17.11%; In addition, other products contributed 384 million yuan of revenue, accounting for 3.16%, as shown in the figure above.

The largest revenue source of Chenguang stationery is the office direct sales business, which contributed 4.932 billion yuan in the first three quarters of last year, accounting for 40.59%.

Shanghai kelipu Information Technology Co., Ltd. (hereinafter referred to as “kelipu”) is mainly responsible for this part of business. Klip mainly provides cost-effective office one-stop procurement services for governments, enterprises and institutions, world top 500 enterprises and other small and medium-sized enterprises.

02

The growth rate of the annual report is not optimistic

It remains to be seen whether the dilemma of Chenguang stationery is short-term or trend.

According to the annual report data of recent years, the growth rate of operating revenue of Chenguang stationery has been declining from 2017 to 2020, during which the data were 36.35%, 34.26%, 30.53% and 17.92% respectively.

Although this data maintained a year-on-year growth rate of 61.43% in the first three quarters of this year; However, combined with the above analysis, it can be concluded that most of this growth is contributed by the first half of this year.

Moreover, the performance growth rate in the third quarter declined in a single quarter, which may continue to the fourth quarter of this year.

Open source Securities believes that the traditional core business of Chenguang stationery was under short-term pressure in the first half of last year; Therefore, they expect that in the fourth quarter of 2021, Chenguang stationery will mainly digest inventory, and the growth of revenue will continue to slow down.

Huaxi Securities believes that after the implementation of the “double reduction” policy, the main impact is the reduction of passenger flow from stores near primary schools and teaching auxiliary institutions, which can be improved through product upgrading, increasing the proportion of high-end customized products and upgrading the image of stores.

According to the estimation of the organization, at present, the market share of Chenguang stationery in the domestic stationery market is about 8%, and there is still great room for improvement in the future. Moreover, it is expected that the main business of the company’s traditional core stationery will maintain a growth of 10% - 15% in the medium term.

In addition, with the digestion of industrial chain inventory and the catalysis of primary school flood, the marketing trend is improving (primary school flood is a term invented by stationery retailers, which means that many students buy a lot of things at the beginning of school, which is called primary school flood after winter vacation and college flood after summer vacation).

At the same time, the stationery leader is also actively adjusting to cope with industry changes.

Guojin Securities believes that in the medium and long term, under the Growth Logic of category expansion and structural optimization, the capacity boundary is expected to continue to expand. The new businesses kelipu and Jiumu sundry agency are expected to further improve the growth quality on the basis of high growth and ensure the medium and long-term growth momentum.

According to the Research Report of Zheshang securities, Chenguang stationery, while paying close attention to the basic plate of offline stores, will increase penetration, improve the sales proportion of Chenguang products, and continuously improve the operation efficiency online. In the future, Chenguang stationery will become an important contribution source of performance increment.

In addition, klip, which is responsible for the main business of Chenguang Stationery - office direct sales, is in the period of development.

According to Kaiyuan securities, klip expects to maintain growth in the fourth quarter of last year, and its annual revenue is expected to exceed 7 billion yuan in 2021. In addition, they also expect that the revenue of klip is expected to exceed 10 billion in 2022. because