Chiyou Co., Ltd. (603429) Company Review: Equity Incentive for the First Time Completed Exclusively Optimistic on the Company’s Cigarette Mark Volume + Thin Card Position Advantage Dual Drive

Chiyou Co., Ltd. (603429) Company Review: Equity Incentive for the First Time Completed Exclusively Optimistic on the Company’s Cigarette Mark Volume + Thin Card Position Advantage Dual Drive
The highest stocks are granted as scheduled, and equity incentives are tied to the core team’s interests.On September 25, 2019, the company issued an equity incentive plan and proposed to approve an increase of 6.85 million shares, accounting for the company’s total share capital2.58%.On January 8, 2020, the company granted additional shares to the incentive objects for the first time, with 5.48 million shares granted, accounting for 2 of the company’s total share capital.06%.Incentives include 26 company directors, senior management, core management and key personnel. Among them, the company’s tobacco label president and tobacco label leader Guo Shuguang was awarded 24 of the total number of shares granted.62%, accounting for 0 of the company’s total share capital.63%.The grant price of the initial public offering is 17.79 yuan / share, the sale restriction period is 12, 24, 36 months, and the proportion of lifting the sale restriction is 30%, 30%, 40% respectively.The company rewarded incentive shares as scheduled, and a large percentage of its core management personnel were awarded incentive shares. The company’s future development momentum is strong. The introduction of high-level assessment standards demonstrates the company’s confidence.The company’s 2019-2021 performance appraisal (net profit attributable to the mother who does not pay the share expenditure expenses) has targets of RMB 240 million and RMB 600 million, an annual increase of 73.3%, 100.0%, 50.0%, the company issued high-performance evaluation standards, showing the company’s business development confidence, we expect the company’s performance will maintain rapid growth year by year.Part of the total amortization cost granted for the first time to this incentive is approximately 6,328.830,000 yuan, the amortization expenses for each period from 2020 to 2022 will be 3691.82, 1793.17,843.840,000 yuan. The Chinese version of heating does not burn more than 100 billion spaces, and the company’s sheet technology field has a carding advantage.HNB cartridges are clearly classified as tobacco products, and are managed by the Tobacco Monopoly Bureau in accordance with the law. The production and sales are exclusively monopolized by China Tobacco.China Tobacco Corporation is actively deploying new tobacco products. Hubei, Sichuan, and Yunnan China Tobacco alternate heating type new tobacco products have been released. Currently, Guangdong, Sichuan, Hubei, and Yunnan have begun to sell heated non-combustion products 合肥夜网 overseas, and many provinces are actively storing.China Tobacco’s positive actions reflect a clear domestic policy attitude.Jiyou focuses on heating non-combustion products, and continues to promote cooperation with China Tobacco. The company is leading the HNB layout. In 17 years, it established a joint engineering center with Anhui Tobacco.The conditions of formula screening and small batch setting out of the homogenized tobacco crushed tobacco group are both performed.It has joined hands with Jiangsu Tobacco and Chongqing Tobacco to jointly develop and promote the achievement of industrialization and landing is worth looking forward to.The company’s wafer production qualification is being smoothly promoted, and the Chinese version of HNB is continuously advancing. The company’s wafer technology has a card position advantage.HNB 深圳桑拿网 is a blue ocean market with a scale of more than 100 billion. The annual profit of the segmented market is nearly 10 billion. Domestic policies actively promote the development of new tobacco products. The future is bright and broad. Cigarette labels have gradually entered the heavy volume period, contributing great performance flexibility.In 19H1, the new production capacity of the tobacco label in Taihu Base was formally put into operation, and the technical reform of Shaanxi Dafeng went smoothly. The certification of new customers about half a year after the tobacco label was in place at the end of 18 years has achieved results.45 billion (VS 18 initially 1.57 billion).Recently, the tobacco bidding results of various provincial Tobacco companies in 2020 were released intensively. Based on the existing Anhui Tobacco, Yunnan Tobacco, and Shaanxi Tobacco, the company has newly entered Hubei Tobacco, Fujian Tobacco, and the development of new customers has progressed smoothly.The follow-up company will actively participate in the bidding of cigarette labels in other provinces.This year, the company benefits from increased production capacity, new customer orders, and other factors. The cigarette label will enter a rapid volumetric period. It will sell 220,000 boxes in 18 years, and we expect to reach 800,000 boxes in 19 years. It is expected to double in 20 years. The capital increase has been completed.It is estimated that the total production capacity of the projects raised in 2020 will reach 2.45 million boxes. With high incentive plan assessment goals, we are optimistic about the company’s smoke standard and heating and non-combustion business two-wheel drive.The cigarette label enters into the fast volume period, and the dual technology advantage of heating and non-combustion card works closely with China Tobacco.We maintain the company’s profit forecast for 19/20/21 attributable to the parent’s net profit at 2.11/4.97/7.USD 6.6 billion, a year-on-year increase of 83% / 135% / 54%. The current expected PE is 42.97X / 18.27X / 11.84. Maintain “Buy” rating. Risk Warning: The development of cigarette label business is less than expected, the new tobacco policy is less than expected, etc.