\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 976 Jianmin Pharmaceutical Group Co.Ltd(600976) )
Chinese time-honored brands forge ahead and rank among the top 100 pharmaceutical enterprises Jianmin Pharmaceutical Group Co.Ltd(600976) has three major brands of “Jianmin”, “Longmu” and “Ye Kaitai”, with stable equity structure. In 2021, it granted equity incentive to the core management, deeply bound the management, and the company’s performance is expected to be further improved.
The year-on-year growth rate of revenue and net profit attributable to the parent company of traditional Chinese medicine sector has warmed up, and the industry can grow with policy support. Since 2017, the market performance and performance growth of some listed companies in the traditional Chinese medicine industry have been outstanding, and some small and medium-sized stocks have also performed very well. In recent years, the state has issued many heavy policies, regulatory policies and favorable policies to promote the innovation and high-quality development of the traditional Chinese medicine industry.
Jianmin’s core products have strong consumption attributes, and in vitro bezoar contributes to performance growth space. The proportion of the company’s pharmaceutical industry revenue increases year by year, and its core products Longmu Zhuanggu Granule, Xiaojin capsule and Jianpi Shengxue granule contribute nearly half of the revenue of the pharmaceutical industry. Due to the high population base of children and the low intake of calcium, the permeability of Longmu is expected to continue to increase. Xiaojin capsule has entered the catalogue of centralized collection of traditional Chinese medicine in 19 provinces such as Hubei and 7 provinces such as Guangdong, with limited price reduction, accelerated hospital volume and reduced sales expenses, or the advantages may outweigh the disadvantages.
Wuhan Jianmin Dapeng, the exclusive manufacturer of in vitro bezoar cultivation, is expected to continue to contribute to the company’s performance. Natural bezoar is scarce and its price continues to rise. As the only manufacturer of bezoar cultivated outside the equivalent substitute of natural bezoar, Wuhan Jianmin Dapeng benefits from intellectual property rights, patented technology and capacity constraints in the oligarch market. It is expected to maintain the oligarch position of in vitro bezoar cultivation for a long time and bring continuous performance growth to the group.
Investment advice and profit forecast. It is estimated that the net profit attributable to the parent company in 21-23 years will be RMB 325 / 421 / 535 million respectively, with a year-on-year increase of 120.0% / 29.5% / 27.1% and EPS of 2.12/2.74/3.49 respectively. In view of the exclusivity of in vitro cultivation of bezoar and the strength of rising both in volume and price, and the steady growth logic of core products such as Longmu Zhuanggu granules, the company was given a valuation of 33xp / E in 2022, corresponding to the target price of 90.4 yuan, and was given a “buy” rating for the first time.
Risk tips: policy change risk, R & D risk, raw material price risk and product concentration risk.
