2021.09.01
■ Yili reported revenue growth of 5% and 18.9% yoy to Rmb29.2bn and Rmb56.5bn in 1H21, and net profit growth of 42.5% yoy to Rmb5.3bn, above our expectations, due to stronger sales growth and better control of distribution expenses.
■ The raw milk price increased by 15% yoy in 1H21, and management expects a high single digit increase in 2H21F and a c.10% yoy increase in FY21F. We expect less raw material price pressure hoh in 2H21F.
■ Online sales grew by 21.8% yoy in 1H21; Yili will continue to cooperate with new distribution channels, like O2O and community group purchase channels.
■ Reiterate Add with higher DCF-based TP of Rmb53.
