Recently, the stock price of bear electric, a small creative household appliance company, has been falling endlessly. Compared with last year’s high, the share price has almost halved. Therefore, the future development prospect of this creative small household appliance enterprise has also been concerned by the outside world.
Some people think that the development of bear electrical appliances is worrying, and the performance of the capital market has made a judgment on this. However, nail technology believes that it is too early to draw such a conclusion in terms of current development.
Judging from the performance in 2020, the performance of bear electric is still very amazing. On January 26, Xiaoxiong electric released its 2020 performance forecast. It is estimated that the net profit attributable to shareholders of Listed Companies in 2020 will be 402 million yuan to 456 million yuan, with a year-on-year increase of 50% to 70%. Sales revenue of the company increased by 30% – 40% year on year.
Nail technology believes that in the context of the deep depression of the big appliance market and the slow growth of the small kitchen appliance industry, bear’s performance is very excellent.
The question is that bear’s growth rate slowed down significantly in the fourth quarter of 2020. We believe that this is an objective fact. In this regard, the explanation of bear electric is:
The company’s operating performance in the fourth quarter is lower than the previous budget, but it is still in a normal range. Among them, the growth rate of the income side slowed down on a month on month basis. On the one hand, due to the impact of the epidemic in the first half of the year, some categories consumed in advance, and the intensity of the outbreak of double 11 and double 12 in 2020 was weaker than in previous years. On the other hand, due to the strong promotion when the company went public in August 2019, the revenue and profit in the fourth quarter of that year were very good, resulting in a higher year-on-year base.
Nail technology believes that judging the development prospects of an enterprise depends on two fundamental aspects: one is the general trend of the industry, that is, whether the industry is in a growth period or a shrinking period; the other is the market position, that is, how the enterprise is in the industry.
At present, small household appliances are still one of the few growth highlands and profit Highlands in the household appliance industry, and there is still a large space for development. According to the total data of zhongyikang, the market scale of kitchen appliances and household appliances is expanding year by year, and the huge market demand and low saturation rate will ensure the long-term rapid growth of the market.
At present, Xiaoxiong electric appliances is in a leading position in the small appliance market. Although the overall size is not as big as SUPOR, Jiuyang and Midea Group, the dominant brands of the above giants are basically concentrated in several categories, such as rice cookers, soymilk machines and pots, while Xiaoxiong leads the industry in many categories.
It is worth noting that the growth of bear is very rapid, and its revenue has maintained a growth rate of more than 30% in recent two years, and its profitability is stronger than that of traditional small appliance giants. For example, in 2019, the gross profit rate of bear electric is 34.26%, which is 3 percentage points higher than that of Supor, a small household appliance enterprise with a revenue of nearly 20 billion, and 6 percentage points higher than that of the whole white household appliance industry.
In fact, the rise of bear has also attracted the attention of its competitors. A few days ago, Fang Hongbo, chairman of Midea Group, put forward higher requirements for Midea’s small appliance business, believing that Midea’s small appliance business is not facing development problems, but survival problems.
In the view of nail technology, such evaluation is actually a precursor to launch a new round of reform. Midea will iterate in business model, industrial structure, industry rules, mechanism and system, product form, new business form, management and other aspects. And let Midea have such a sense of crisis, the rise of bear appliances, is bound to be an important factor.
Therefore, in general, the fundamentals of the development of bear electrical appliances are not too big a problem. However, nail technology believes that in the future, bear electric also needs to do more innovation iterations, such as the problem of R & D investment, which has been criticized by people, that is, the proportion of R & D investment is lower than the proportion of marketing investment; for example, the problem of SKU expansion too fast, which is also shown by zhongyikang data, accurate product selection is very important, otherwise it is easy to fall into the development trap.
In addition, nail technology believes that bear electric needs to be prepared for the iterative reform of a giant like Midea. After all, once the giant wakes up, the whole market competition pattern may usher in a new round of reconstruction.
Editor in charge: Tzh