Core view
Biweekly performance of the sector: in the past two weeks, the CSI 300 index fell by 3.33%, and the pharmaceutical and biological (Shenwan) index rose by 1.89%, with a relative return of 5.21% compared with the CSI 300, ranking third in the industry. Since the beginning of 2022, the CSI 300 index has fallen by 8.99%, and the pharmaceutical and biological (Shenwan) index has fallen by 11.62%, with an excess return of – 2.63% compared with the CSI 300. The overall rise and fall ranks 22nd in the industry. In terms of molecular sectors, six of the seven Shenwan pharmaceutical sub industries rose in the past two weeks, among which SW chemical API, SW pharmaceutical commercial II and SW biological products II increased the most, up 7.77%, 4.74% and 3.75% respectively; There was a decline in one sector, which was SW medical devices, with an increase of – 0.36%, and the finishing performance was stronger than the market. Since the beginning of the year, the overall trend of the pharmaceutical sector has been weak, and the growth of sub industries has been negative. Among them, SW chemical API rose by – 0.63%, while SW medical service II rose by – 16.73%.
Weekly tracking of individual stocks: 1) from the rise and fall of individual stocks: from the rise and fall of individual stocks, 333 stocks of A-Shares in the pharmaceutical industry (including the science and Innovation Board) rose positively and 98 stocks fell in the past two weeks. The top five stocks in the past two weeks are Nanjing Hicin Pharmaceutical Co.Ltd(300584) (+ 75.03%), Xinxiang Tuoxin Pharmaceutical Co.Ltd(301089) (+ 68.39%), dajiaweikang (+ 57.93%), Honz Pharmaceutical Co.Ltd(300086) (+ 48.31%), Gansu Longshenrongfa Pharmaceutical Industry Co.Ltd(300534) (+ 47.84%). The top five stocks with declines in recent two weeks are digital people (- 21.37%), Andon Health Co.Ltd(002432) (- 14.33%), Lude medical (- 13.28%), Chengdu Olymvax Biopharmaceuticals Inc(688319) (- 12.78%), Suzhou Zelgen Biopharmaceuticals Co.Ltd(688266) -u (- 11.83%). 2) Shares held by luchutong: in the past two weeks, the total net purchase of northbound funds was 1.728 billion yuan, including 6.963 billion yuan of inflow and 5.236 billion yuan of outflow. From the position of land stock connect, the top five holdings increase are Sunflower Pharmaceutical Group Co.Ltd(002737) , Lanzhou Foci Pharmaceutical Co.Ltd(002644) , Shanxi C&Y Pharmaceutical Group Co.Ltd(300254) , Chengdu Kanghua Biological Products Co.Ltd(300841) , Fuan Pharmaceutical (Group) Co.Ltd(300194) . The top five holdings reduction are Shanghai Kaibao Pharmaceutical Co.Ltd(300039) , Frontier Biotechnologies Inc(688221) , Kontour(Xi’An) Medical Technology Co.Ltd(688314) , Zhejiang Shapuaisi Pharmaceutical Co.Ltd(603168) , Shanxi Panlong Pharmaceutical Group Limited By Share Ltd(002864) . 3) Block transactions: in the past two weeks, 65 companies in the pharmaceutical and biological industry have had block transactions, with a total transaction amount of 3.048 billion yuan. The top five block transactions are Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) , Sansure Biotech Inc(688289) , Xinxiang Tuoxin Pharmaceutical Co.Ltd(301089) , Shanghai Zj Bio-Tech Co.Ltd(688317) , Zhejiang Starry Pharmaceutical Co.Ltd(603520) .
Sector valuation level: the valuation is at a historical low, and the industry has entered the bottom configuration range.
In the past two weeks, the PE (TTM) valuation of the pharmaceutical and biological sector reached 31.2x, which is still lower than the average pe37.5 in the past five years 85X。 Since the beginning of the year, the sector valuation has further explored. The quantile of PE (TTM) valuation has reached 14.64% in recent 5 years (2017 / 3 / 4-2022 / 3 / 4) and 10.41% in recent 10 years (2012 / 3 / 4-2022 / 3 / 4), which is at a historically low level. Compared with the same industry, the premium rate of pe-ttm in the pharmaceutical and biological sector relative to all A-Shares excluding finance is 10.78%, and the premium rate relative to CSI 300 is 140.05%.
From the perspective of sub sector peg, the predicted PEG (2022) of most sectors is about 1, which is in a reasonable low range, and the allocation value is prominent.
Industry highlights: 1) the enhanced BTD: CDE issued the working procedures of the drug review center for accelerating the review of innovative drug listing application (Trial) for comments; 2) The restricted directory of grass-roots level is released! The original research is great; 3) Who will win the battle of collecting growth hormone?; 4) 53 domestic class 1 new drugs apply for clinical application, and 3 domestic class 1 new drugs apply for listing! Yiyi biology, Sihuan pharmaceutical, stone medicine; 5) Fujian Cosunter Pharmaceutical Co.Ltd(300436) the innovative drug under research has obtained the patent authorization notice from China and South Korea.
Investment proposal and investment object
It’s recommended to focus on: Hengrui medicine ( Jiangsu Hengrui Medicine Co.Ltd(600276) , with a rating of Jiangsu Hengrui Medicine Co.Ltd(600276) , which is not rated), and Wuxi Apptec Co.Ltd(603259) \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ ( Chongqing Zhifei Biological Products Co.Ltd(300122) , not rated), etc.
Risk tips
The R & D, promotion and listing of new drugs were less than expected, the industry volume procurement policy was more than expected, and the epidemic broke out again
