\u3000\u3000 Apt Medical Inc(688617) (688617)
On January 27, 2022, the company released the performance forecast for 2021. It is estimated that the net profit attributable to the parent company will reach 192-209 million yuan in 2021, with a year-on-year increase of + 73% ~ + 89%; It is estimated that in 2021, the net profit deducted from non parent company is 170 ~ 187 million yuan, with a year-on-year increase of + 74% ~ + 91%.
Quarterly, it is estimated that the net profit attributable to the parent company in Q4 in 2021 will be 30 ~ 47 million, with a year-on-year increase of – 24% ~ + 20%; The net profit deducted from non parent company was 24 ~ 41 million yuan, with a year-on-year increase of – 25% ~ + 28%.
Business analysis
Breakthrough in electrophysiological layout and rapid growth of vascular intervention business. Thanks to the recovery of China’s epidemic situation in 2021 and the rapid increase of product market share, the company’s annual performance achieved rapid growth. The electrophysiology sector has realized the innovation and upgrading from two-dimensional to three-dimensional. The coverage and admission penetration of vascular intervention products have also been further improved, of which the coronary product line has increased by 111% year-on-year. Electrophysiology and vascular intervention jointly drive the rapid growth of the company’s business. The scale effect brings cost reduction and efficiency increase in the production and manufacturing links. At the same time, the profitability has also increased steadily. The rapid growth trend of the company is expected to continue in the future.
Product R & D has been promoted rapidly and international business has continued to develop. The company attaches great importance to the construction of R & D team, and has laid out rich product R & D pipelines in electrophysiology, coronary intervention and peripheral intervention sectors, including new pulse ablation products and thoracic aortic covered stents. It is expected that R & D investment will continue to grow in the future. At the same time, the international business continues to achieve rapid development. Nearly 50 product registration approvals from more than 10 countries were completed in 2021, which will gradually open the potential overseas market space in the future.
Domestic substitution space is huge, and three-dimensional electrophysiology is expected to accelerate the volume. In the past, Chinese electrophysiological and coronary pathway products were dominated by foreign brands. With the continuous improvement of R & D strength of domestic enterprises and the support of national policies, domestic enterprises are expected to gradually expand their market share. As a scarce domestic equipment, htviewer, the company’s three-dimensional cardiac electrophysiological mapping system, is expected to accelerate the volume of three-dimensional electrophysiological consumables with the company’s increasing market development in the future.
Profit adjustment and investment suggestions
We believe that the company is leading in product technology in the field of electrophysiology and vascular intervention, and is expected to maintain its domestic leading position in the future and gradually seize the market share of foreign-funded enterprises. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 201, 294 and 405 million yuan, with a year-on-year increase of 81%, 46% and 38%. The EPS will be 301, 4.41 and 6.07 yuan / share respectively. The current price corresponds to 69, 47 and 34 times of PE, maintaining the rating of “overweight”.
Risk tips
The risk of medical insurance fee control policy, the risk that the promotion of research projects does not meet the expectations, the risk that the construction progress of raised investment capacity does not meet the expectations, and the risk of exchange rate fluctuation.
