Key investment points:
This week, SW pharmaceutical and biological industry outperformed the Shanghai and Shenzhen 300 index. SW pharmaceutical and biological industry fell 2.07% this week, outperforming the Shanghai and Shenzhen 300 index by about 2.15 percentage points in the same period. Among the industry segments, API rose by 2.08%, while pharmaceutical commerce, medical devices, chemical pharmaceuticals, traditional Chinese medicine, biological products and medical services fell by 0.07%, 0.08%, 2.20%, 2.21%, 3.14% and 3.35% respectively.
This week, the pharmaceutical and biological industry had a net inflow of 370 million yuan. From March 7 to March 11, 2022, the net outflow of land stock connect was 36.320 billion yuan, including 17.979 billion yuan from Shanghai Stock connect and 18.341 billion yuan from Shenzhen Stock connect. Among the industries at the level of Shenwan, the net inflow of public utilities and national defense industry ranks first, and the net outflow of banks, food and beverage and power equipment ranks first. This week, the pharmaceutical and biological industry had a net outflow of 3.779 billion yuan, ranking sixth in the net outflow of Shenwan primary industry, with a slight increase compared with last week.
Industry valuation. As of March 11, 2022, the overall PE (TTM, overall method, excluding negative value) of SW pharmaceutical and biological industry was about 28.2 times, slightly lower than that of last Friday. The current valuation is lower than the valuation center of the industry since 2012, at the quantile of 76%; The overall PE premium rate relative to CSI 300 is 138.5%, which is 64% of the central premium rate of the industry relative to CSI 300 since 2012.
Maintain the recommended rating of the industry. In March 11th, the Health Commission issued the notice on the issuance of the COVID-19 virus antigen detection application plan (Trial), and the joint defense and control mechanism group of the State Council decided to promote the monitoring mode of antigen screening and nucleic acid diagnosis, and add antigen detection as a supplement on the basis of nucleic acid detection. The plan also points out that, “If community residents have self-test needs, they can purchase antigen detection reagents for self-test through retail pharmacies, online sales platforms and other channels.” it is suggested to pay attention to covid-19 antigen detection related enterprises Guangzhou Wondfo Biotech Co.Ltd(300482) ( Guangzhou Wondfo Biotech Co.Ltd(300482) ), Zhejiang Orient Gene Biotech Co.Ltd(688298) ( Zhejiang Orient Gene Biotech Co.Ltd(688298) ), an Xu Biology (688075) which are expected to be widely used in China and have a broad market space , Beijing Hotgen Biotech Co.Ltd(688068) ( Beijing Hotgen Biotech Co.Ltd(688068) ), Shenzhen Yhlo Biotech Co.Ltd(688575) ( Shenzhen Yhlo Biotech Co.Ltd(688575) ), Andon Health Co.Ltd(002432) ( Andon Health Co.Ltd(002432) ), Wuhan Easy Diagnosis Biomedicine Co.Ltd(002932) ( Wuhan Easy Diagnosis Biomedicine Co.Ltd(002932) ), etc; Enterprises related to upstream raw materials for antigen detection Nanjing Vazyme Biotech Co.Ltd(688105) ( Nanjing Vazyme Biotech Co.Ltd(688105) ), Sino Biological Inc(301047) ( Sino Biological Inc(301047) ), Acrobiosystems Co.Ltd(301080) ( Acrobiosystems Co.Ltd(301080) ), etc; In the future, residents can purchase antigen detection reagents for self-test through retail pharmacies and other channels. Retail pharmacies are expected to usher in improved Yifeng Pharmacy Chain Co.Ltd(603939) ( Yifeng Pharmacy Chain Co.Ltd(603939) ), Lbx Pharmacy Chain Joint Stock Company(603883) ( Lbx Pharmacy Chain Joint Stock Company(603883) ), Dashenlin Pharmaceutical Group Co.Ltd(603233) ( Dashenlin Pharmaceutical Group Co.Ltd(603233) ), Yixintang Pharmaceutical Group Co.Ltd(002727) ( Yixintang Pharmaceutical Group Co.Ltd(002727) ), etc; The valuation is relatively reasonable, and the prosperity is expected to maintain a good CXO leader and leader in subdivided fields Wuxi Apptec Co.Ltd(603259) ( Wuxi Apptec Co.Ltd(603259) ), Porton Pharma Solutions Ltd(300363) ( Porton Pharma Solutions Ltd(300363) ), Asymchem Laboratories (Tianjin) Co.Ltd(002821) ( Asymchem Laboratories (Tianjin) Co.Ltd(002821) ), Pharmaron Beijing Co.Ltd(300759) ( Pharmaron Beijing Co.Ltd(300759) ), Kyushu Pharmaceutical ( Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) ), Joinn Laboratories (China) Co.Ltd(603127) ( Joinn Laboratories (China) Co.Ltd(603127) ), Hangzhou Tigermed Consulting Co.Ltd(300347) ( Hangzhou Tigermed Consulting Co.Ltd(300347) ), etc; Medical device leader Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ( Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ), pharmaceutical equipment leader Tofflon Science And Technology Group Co.Ltd(300171) ( Tofflon Science And Technology Group Co.Ltd(300171) ) and Truking Technology Limited(300358) ( Truking Technology Limited(300358) ) with relatively reasonable valuation; Chain medical leaders Aier Eye Hospital Group Co.Ltd(300015) ( Aier Eye Hospital Group Co.Ltd(300015) ), Topchoice Medical Co.Inc(600763) ( Topchoice Medical Co.Inc(600763) ), which are expected to benefit from aging and strong endogenous growth momentum; Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) ( Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) ), China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) ( China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) ), Beijing Tongrentang Co.Ltd(600085) ( Beijing Tongrentang Co.Ltd(600085) ), etc. are expected to benefit from the policy of traditional Chinese medicine.
Risk tip: the demand for covid-19 antigen detection has not increased as expected, the industry competition has intensified, product price reduction, product safety and quality risk, policy risk, repeated epidemic, and the R & D progress is lower than expected.
