The Zhitong Finance App learned that Guotai Junan released a research report saying that currently the leading stock price in the beer industry corresponds to an average valuation of around 18X in 2024, and the leading Hong Kong stock valuation is only 15X, all at the bottom of historical valuations. Currently, stock prices fully reflect expectations of consumer trends, and the market's expectations for the 2024 boom are low. The bank believes that the industry attributes, industrial cycle, and ecological pattern have not deteriorated. In 2024, leaders are expected to achieve double-digit profit growth while maintaining the possibility of high dividends or increased dividend rates. Compared with other racetracks, there is a higher probability of major single product innovation and category breakthroughs. Maintaining “additional” ratings for Tsingtao Brewery (600600.SH), Yanjing Brewery (000729.SZ), and Hong Kong stock China Resources Brewery (00291).

Guotai Junan's views are as follows:

Tsingtao Brewery: It is expected that in 2024, the company will continue to adhere to low-grade optimization and the “big classic” strategy. Laoshan and other brands will rapidly iterate over the next two to three years, and the price of 8 yuan represented by “classic” and “white beer” will account for or continue to rise above 35% (2024E). The tonnage price is expected to maintain moderate unit growth in 2024. Judging from the current inquiry situation, the price of malt fell by double digits in 2024, the price of packaging materials remained low, and the overall cost may be expected to decline in 2024. The bank expects profit growth of 15-20% in 2024, maintaining a profit forecast of around 18-20% in 2023.

China Resources Beer: Heineken's annual sales volume is expected to increase by 50% or more in 2023, and is expected to increase by more than 30% in 2024. Driven by combined sales of Xuehua Chunsheng and Heineken, the two major high-end single products have progressed beyond expectations in early 2023. According to the bank's estimates, the share above the second highest is expected to reach about 20% in 2023, and will continue to rise in 24-25. The average tonnage price is expected to rise by a lower number of units in 2024. On the cost side, barley costs are expected to drop by about 10% in 2024, and overall packaging materials will remain low. The bank expects a year-on-year decline in raw material tonnage costs in 2024. The bank expects a small double-digit increase in profit in 2024, maintaining the profit forecast for 2023 at a profit growth rate of around 15%.

Yanjing Beer: It is expected that in 2024, the company's U8 major products will continue to grow rapidly, while driving the two wings to fly together. Fresh and fresh may become a new growth point. Clean will follow the trend and drive price sorting after the packaging is renewed. A sharp rise in volume and price is expected. Furthermore, high-end products still have a lot of room for upgrading and expansion in low base. The bank expects double-digit profit growth in 2024. According to the company's latest performance forecast, net profit without return to mother will be 41-520 million yuan in 2023, +50.98%-91.49% year-on-year.

Chongqing Beer: Mainstream brands Leburg and Chongqing remain strong, and mainstream brands are expected to achieve high unit growth throughout 2023-2024. Wusu is expected to decline in 2023, and the economy is expected to stabilize in 2024. In the context of structural recovery, the cost of tons is expected to drop by about 1% in 2024, and there is still room for improvement in gross margin. The bank expects low revenue growth units and profit growth units in 2024. The bank expects the company to continue its high dividend strategy. Currently, the stock price corresponds to a dividend rate of around 3-4% for 23-25 years.

Risk warning: cost fluctuations, weather factors.