Key points:
Traditional Chinese Medicine II fell 0.17% last week, and the pharmaceutical sector continued to callback due to factors such as UVL list
Last week, pharmaceutical biology closed at 9419.72 points, down 2.73%; Traditional Chinese Medicine II closed at 7269.23 points, down 0.17%; Chemical pharmaceutical closed at 10669.73 points, down 0.68%; Biological products closed at 10454.92 points, up 2.17%; Pharmaceutical business closed at 5799.88 points, up 1.35%; Medical devices closed at 8436.04 points, down 2.76%; Medical services closed at 8526.48 points, down 11.1%. Affected by the listing of YaoMing biology in the UVL list by the United States, the pharmaceutical sector continued to callback. Among the sub sectors, biological products and pharmaceutical businesses achieved positive returns, while the decline of traditional Chinese medicine was relatively small.
From the performance of traditional Chinese medicine companies, the top companies are: Zhuzhou Qianjin Pharmaceutical Co.Ltd(600479) , Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Henan Lingrui Pharmaceutical Co.Ltd(600285) , Tasly Pharmaceutical Group Co.Ltd(600535) , Kpc Pharmaceuticals Inc(600422) ; Companies with low performance include: Jinghua Pharmaceutical Group Co.Ltd(002349) , Guangdong Taiantang Pharmaceutical Co.Ltd(002433) , Guiyang Xintian Pharmaceutical Co.Ltd(002873) , Guilin Sanjin Pharmaceutical Co.Ltd(002275) , Gansu Longshenrongfa Pharmaceutical Industry Co.Ltd(300534) .
Traditional Chinese medicine PE (TTM) decreased by 0.05x month on month, while Pb (LF) remained unchanged month on month
Last week, the PE of traditional Chinese medicine was 32.08x, the maximum value of PE in recent year was 39.7x and the minimum value was 28.78x; The current Pb is 2.92x, the maximum value of Pb in recent years is 3.56x, and the minimum value is 2.57x. PE in the traditional Chinese medicine sector decreased by 0.05x month on month, while Pb was flat month on month. At present, the valuation is slightly lower than the median level in recent one year. The premium rate of traditional Chinese medicine sector relative to Shanghai and Shenzhen 300 was 140.08%.
Favorable policies for traditional Chinese medicine have been issued one after another, and the investment logic of traditional Chinese medicine remains unchanged
In 2019, the CPC Central Committee and the State Council issued the opinions on promoting the inheritance, innovation and development of traditional Chinese medicine, and in 2021, the general office of the State Council issued several policies and measures on accelerating the characteristic development of traditional Chinese medicine. In order to cooperate with national policies, many provinces and cities such as Inner Mongolia, Liaoning, Shandong and Shanghai have issued corresponding supporting policies to support the development of traditional Chinese medicine industry. Recently, the Wuxi Municipal Party committee and the Wuxi Municipal People's Government of Jiangsu Province called for the full establishment of a traditional Chinese medicine service system with Wuxi traditional Chinese medicine hospital as the leader, various traditional Chinese medicine medical institutions at all levels and other medical institutions as the backbone, grass-roots medical and health institutions as the basis, and integrating prevention and health care, disease treatment and rehabilitation. The people's Government of Guangxi Zhuang Autonomous Region requires to promote the innovation and development of traditional Chinese medicine Zhuang Yao medical science and technology, build a Guangxi Traditional Chinese medicine Zhuang Yao medical science and technology innovation platform, and cultivate a national technological innovation center. Chongqing Wulong District People's government proposes that by 2025, 100% of township health centers and street community health service centers in the region will have traditional Chinese medicine clinics and equipped with traditional Chinese medicine doctors. Yunnan Provincial Health Commission, Yunnan Provincial Development and Reform Commission and other seven departments jointly issued several measures of Yunnan Province on further standardizing medical behavior and promoting reasonable medical examination, which made it clear that it was necessary to explore medical insurance payment methods in line with the characteristics of traditional Chinese medicine. It can be seen that the favorable policies of traditional Chinese medicine are still being introduced, and the next three years will be the stage of continuous implementation of the policies.
Although the traditional Chinese medicine sector has been adjusted to a certain extent recently, the investment logic of the industry remains unchanged. The biggest positive factor for the traditional Chinese medicine industry in 2022 is policy support. On the demand side, the rigid demand characteristics of the pharmaceutical industry and the upgrading of pharmaceutical consumption jointly support the steady growth of the demand of the traditional Chinese medicine industry. On the policy side, a series of favorable policies have been formed to promote the innovation of traditional Chinese medicine, the development of formula particles, the support of medical insurance and payment policies, and the continuous addition of traditional Chinese medicine decoction pieces can not exceed 25%, bringing policy dividends and new demand to the traditional Chinese Medicine industry. The unique advantage of "preventing disease" brings development opportunities to the traditional Chinese medicine industry. On the performance side, the traditional Chinese medicine industry walked out of the low point and showed a marginal improvement trend. On the valuation side, the traditional Chinese medicine industry still has certain valuation advantages after valuation repair. "Policy + pharmaceutical consumption upgrading + performance improvement + valuation advantage" jointly constructs investment opportunities for the traditional Chinese medicine industry. It is suggested to pay attention to the areas of policy encouragement and policy haven.
(1) pay attention to the innovation of modern traditional Chinese medicine, and pay attention to the innovation targets of modern traditional Chinese medicine with strong R & D strength and layout of large categories (large market: cardio cerebrovascular + fast growth: pediatric medicine);
(2) pay attention to the advantages of brand traditional Chinese medicine, formula and raw materials, and jointly build a moat of brand traditional Chinese medicine;
(3) benefit from consumption upgrading, and pay attention to the subject matter of industrial chain extension and strong brand advantage.
Risk tips
(1) stricter industrial policies;
(2) industry and listed company performance fluctuation risk.
