Key points:
Traditional Chinese Medicine II rose 3.62% last week, and the pharmaceutical sector rebounded as a whole. Traditional Chinese medicine continued to rise. Last week, pharmaceutical biology closed at 11385.45 points, up 3.16%; Traditional Chinese Medicine II closed at 8563.6 points, up 3.62%; Chemical pharmaceutical closed at 12336.5 points, up 4.13%; Biological products closed at 12279.02 points, down 1.49%; Pharmaceutical business closed at 6446.94 points, up 7.7%; Medical devices closed at 9960.7 points, up 3.17%; Medical services closed at 11782.18 points, up 4.01%. The pharmaceutical sector rebounded as a whole, and the traditional Chinese medicine sector continued to rise.
From the performance of Companies in the traditional Chinese medicine sector, the top companies are: Jinghua Pharmaceutical Group Co.Ltd(002349) , Kunming Longjin Pharmaceutical Co.Ltd(002750) , Tianjin Chase Sun Pharmaceutical Co.Ltd(300026) , Chongqing Pharscin Pharmaceutical Co.Ltd(002907) , Gansu Longshenrongfa Pharmaceutical Industry Co.Ltd(300534) ; Companies with low performance include: Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) , Guilin Sanjin Pharmaceutical Co.Ltd(002275) , Renhe Pharmacy Co.Ltd(000650) , Guangdong Jiaying Pharmaceutical Co.Ltd(002198) , Mayinglong Pharmaceutical Group Co.Ltd(600993) .
Traditional Chinese medicine PE (TTM) increased by 2.49x month on month, and Pb (LF) increased by 0.12x month on month
Last week, the PE of traditional Chinese medicine plate was 37.8x, the maximum value of PE in recent year was 39.7x, and the minimum value was 28.78x; The current Pb is 3.04x, the maximum value of Pb in recent year is 3.48x, and the minimum value is 2.57x. PE in the traditional Chinese medicine sector increased by 2.49x month on month, and Pb increased by 0.12x month on month. The premium rate of traditional Chinese medicine plate relative to Shanghai and Shenzhen 300 was 169.61%.
Affected by the cooling and repeated epidemic situation, the price increase of traditional Chinese medicine slowed down, and the overall market is still relatively strong
Last week, the total price index of key tracked traditional Chinese medicine was 207.32 points, up 0.4 percentage points month on month. In terms of varieties, the twelve categories showed five increases and seven decreases year-on-year, and the price index of mineral medicinal materials ranked first. Recently, due to the impact of cooling and repeated epidemic, the market flow has decreased, the price increase of traditional Chinese medicine has slowed down, and some varieties have changes in rise and fall. However, the market as a whole is still relatively strong, and the price is expected to continue to rise slightly in the later stage.
The policy benefits are frequent, and the policy dividends of the traditional Chinese medicine industry are gradually released
Following the 2019 epidemic, especially the covid-19 epidemic, favorable policies related to traditional Chinese medicine have been introduced one after another, and traditional Chinese medicine has ushered in a policy dividend period. Last week, the national medical insurance bureau and the State Administration of traditional Chinese Medicine issued the guiding opinions on medical insurance supporting the inheritance, innovation and development of traditional Chinese medicine, which stipulated the scope, price and payment method of medical insurance reimbursement of traditional Chinese medicine. Among them, basically all institutions that meet the requirements and provide traditional Chinese medicine services are included in the fixed-point management of medical insurance; The Internet plus Chinese medicine services provided by the designated Chinese medicine institutions and the medical insurance agencies in the overall area are included in the scope of medical insurance payment. General TCM medical service items can continue to be paid by item; Traditional Chinese medicine institutions may not implement DRG payment temporarily; Decoction pieces of traditional Chinese medicine can continue to add no more than 25%. The guidance is favorable to the traditional Chinese medicine industry from the inclusion of designated medical insurance to the scope of medical insurance payment, medical insurance payment policy and service price. It can be seen that the favorable policies of the traditional Chinese medicine industry are gradually released and implemented.
We believe that policy support is the biggest catalyst for the development of traditional Chinese medicine industry in 2022. Demand side, population aging, chronic diseases, cancer incidence rate rise, disease spectrum changes, as well as residents’ income level raise health awareness, consumption upgrading and other factors to support the demand for Chinese medicine industry healthy and stable growth. On the policy side, the state vigorously supports and promotes the development of traditional Chinese medicine, promotes the inheritance and innovation of traditional Chinese medicine, and adheres to the equal emphasis on traditional Chinese and Western medicine, which has brought 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 came out of the low point and showed marginal improvement. Although the single quarter performance growth rate decreased slightly in the third quarter of 2021 due to the weakening of the low base effect, it remained in the trend of recovery channel as a whole. On the valuation side, the traditional Chinese medicine industry has obvious absolute valuation advantages. “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 drugs);
(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 statement
(1) Industry policies are becoming stricter;
(2) Industry and listed company performance fluctuation risk
