Investment perspective in March
March 2022 portfolio recommendation
Market review: in February 2022, Shenwan pharmaceutical index rose by 3.98%, outperforming the Shanghai and Shenzhen 300 index by 3.58%, ranking No. 9 in the whole industry this month. The valuation premium rate of the pharmaceutical industry relative to all A-Shares is 84%, the premium rate relative to all A-Shares excluding banks is 39%, and the premium rate relative to the CSI 300 index is 130%. In February, hospitals (8.5%) rose the most and offline pharmacies (- 0.5%) fell the most. Since the beginning of 2022 (up to 20228), the Shenwan pharmaceutical index has fallen by 11.56%, 4.3 percentage points lower than the CSI 300 index, and the rise and fall of the industry ranks 28th.
Strong performance in 2021 ushered in a good opportunity for layout. In February 2022, the pharmaceutical sector rebounded slightly, with SW medicine up 3.98%. We think there are two main factors: 1 In the early stage, the CXO sector suffered a large decline due to the UVL event. Later, according to the performance forecast of 2021 released by the company, the prosperity of the sector is still growing; 2. The medical insurance bureau and others issued the notice on regulating and adjusting the price of some medical services, and included 16 assisted reproductive projects in the medical insurance to benefit the assisted reproductive industry. At the current time point, we are more and more optimistic about the pharmaceutical sector: 1 The current valuation of the pharmaceutical sector is 29 times, which has been gradually digested below the historical center. The valuation and position ratio are at a historical low, and the allocation cost performance is prominent; 2. From the perspective of fundamentals, CXO enterprise performance express gradually disclosed that its performance is generally good, and the performance elasticity in 2022 is large due to the influence of covid-19 small molecular medicine orders. The valuation of the pharmaceutical sector is underestimated + the performance in 2021 is still strong. We believe that the pharmaceutical sector has ushered in the best layout time point recently. Combined with the two main lines of the annual strategy in 2022: “through medical insurance” and “epidemic desensitization”, it is recommended that investors focus on several sector layout opportunities: Traditional Chinese medicine consumer goods / innovative drugs / undervalued value and low expectation, Varieties with upward business trend / supply chain independent and controllable related targets.
Elastic combination: Shanghai Runda Medical Technology Co.Ltd(603108) ( Shanghai Runda Medical Technology Co.Ltd(603108) ), Chongqing Taiji Industry (Group) Co.Ltd(600129) ( Chongqing Taiji Industry (Group) Co.Ltd(600129) ), Tianjin Zhongxin Pharmaceutical Group Corporation Limited(600329) ( Tianjin Zhongxin Pharmaceutical Group Corporation Limited(600329) ), Zhejiang Shouxiangu Pharmaceutical Co.Ltd(603896) ( Zhejiang Shouxiangu Pharmaceutical Co.Ltd(603896) ), Haisco Pharmaceutical Group Co.Ltd(002653) ( Haisco Pharmaceutical Group Co.Ltd(002653) ), Truking Technology Limited(300358) ( Truking Technology Limited(300358) ).
Combination of scientific innovation board: Baiji Shenzhou (688235), Cansino Biologics Inc(688185) ( Cansino Biologics Inc(688185) ), Suzhou Zelgen Biopharmaceuticals Co.Ltd(688266) ( Suzhou Zelgen Biopharmaceuticals Co.Ltd(688266) ), Chengdu Olymvax Biopharmaceuticals Inc(688319) ( Chengdu Olymvax Biopharmaceuticals Inc(688319) ), Aohua endoscopy (688212).
Robust combination: Wuxi Apptec Co.Ltd(603259) ( Wuxi Apptec Co.Ltd(603259) ), Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ( Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ), Jiangsu Hengrui Medicine Co.Ltd(600276) ( Jiangsu Hengrui Medicine Co.Ltd(600276) ), Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) ( Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) ).
Hong Kong stock portfolio: Yaoming Biology (2269), Shanghai Junshi Biosciences Co.Ltd(688180) (1877), haijiya (6078), minimally invasive Siasun Robot&Automation Co.Ltd(300024) (2252), Jinxin reproduction (1951).
Expected risk of drug price reduction; The implementation progress of medical reform policy is lower than the expected risk; Risk of R & D failure.
