【行业研究报告】美的集团-1Q22 beat and an excellent ToB game plan

1Q22wasabeat,thankstobetterGPmargin.WehighlyappreciateMidea’sshift
offocustogeneratebetterthanindustry’sgrowthinthenext3years.Therefore,
wemaintainBUYbutfine-tunedTPtoRMB67.79,basedon15xFY22EP/E
(downfrom22x),vsChina/Int’lpeers’avg.of13x/14x.
FY21resultsinlineand1Q22resultsbeat.ForFY21,sales/netprofitgrew
by20%/5%YoY,4%/0%aboveBBGest.,while1Q22,sales/netprofit
by20%/5%YoY,4%/0%aboveBBGest.,while1Q22,sales/netprofit
increasedby10%/11%,0%/8%aboveBBGest..ForFY21,domestic/
overseassalesgrowthwere25%/14%YoY,andToC/ToBsalesgrowthwere
13%/39%YoY.WithinToBbusiness,IndustrialTechnology/Building
Technologies/DigitalInnovation/Robotic&Automationsalesgrowthwere
44%/55%/51%/23%.Wefind1Q22resultsimpressive,giventhedragfrom
pandemics,andthebeatshouldbeattributedtoGPMimprovement(+0.5ppt
YoYto22.2%in1Q22),drivenbyASPincreasesandbetterproductmix.We
arenowmoreoptimisticaboutGPMinFY22E,drivenbymorerawmaterial
hedgingandCNYdepreciation.
Aimingto“optimizesalesandimprovemargins”inFY22E.Webelieve
Mideamaintainsitsguidanceof“~10%salesand~10%NPgrowth”inFY22E,
supportedbyitsrobustToBsalesgrowthanditsfocuson“optimizesalesand
improvemargins”.Wethinktheactualdriversare:1)premiumization,where
COLMOsalescouldreachRMB8.0bn(vsRMB4.0bninFY21with300%+
YoY),2)rampupofoverseasbusiness,asmorethan600Chinese
managementaredeployedinvariousregionssincelastyearandenteredinto
morePOSsande-commerceplatformsand3)developmentofToBbusiness.
BewareofpotentialsectordownturnandtheshifttoToCbusinessesis
important.Managementishighlycautiousabouthomeappliancesdemand
forthenext3yearsandbelievesitsToBbusinesscanbecomeanewgrowth
driver,whichmainlyconsistsofBuildingcontrol,Autopartssupplychain,
EnergycontrolandAutomationbusinesses.Salesaccountedfor22%inFY21,
andweexpecttoreach~30%byFY25E,witha17%salesCAGRduring
FY21-25E.Forautopartssupplychain,Mideahasedgesindrivesystem,
thermalmanagementsystemandauxiliarydrivingsystem.Ithassecured
ordersfromVolkswagen,andalreadytouchedbasewithTesla.ForKUKA
business,ordersareextremelyrobust,asMideahadenteredBYD,CATLand
Apple’ssupplychain,andweexpectittodeliversalesvolumeof30K/50K-
60KinFY22E/23E(vsabout20Katthetimeofacquisition).