\u3000\u3 Jiangsu Eastern Shenghong Co.Ltd(000301) 087 Cofoe Medical Technology Co.Ltd(301087) )
It is the leader of personal health management in the whole life cycle with rapid development, and has a wide range of products. Formerly known as Hunan Cofoe Medical Technology Co.Ltd(301087) Technology Development Co., Ltd., the company was founded in Liuyang, Hunan Province in 2009. It has transformed from an early trader to a product covering five fields (health monitoring, rehabilitation aids, respiratory support, traditional Chinese medicine physiotherapy and medical care). The product line runs through the whole life cycle of personal health. At the same time, the company has offline service stores such as ear and hearing, creating a leading enterprise of personal health management in the whole life cycle. The company focuses on “Kefu” series products, which has fully covered the main categories of household medical devices. At the same time, other well-known brands have been introduced as a supplement. At present, the company has nearly 10000 product models and specifications and a wide range of products.
The development of household medical device industry is at the right time, and there is a large space for domestic substitution. China’s household medical device industry is in a period of rapid development and has broad development space in the future. According to the statistics of the blue book of China Medical Devices (2020 Edition), the growth rate of domestic medical devices in China exceeds that of the overall medical devices, and the proportion increases year by year. The market scale has grown from 48 billion in 2015 to 118.9 billion yuan in 2019, and the CAGR is as high as 25.45%. The household medical device industry is relatively scattered and the localization rate is low. Products + channels + services + brands are the four major barriers in the household medical device industry. The development path of Johnson & Johnson, an American century old enterprise, has provided valuable experience for Chinese household medical device companies. Focusing on “products + R & D + channels + services” is the only way for Chinese enterprises such as Kefu.
Firmly grasp the four core barriers and build a comprehensive service provider of personal health management in the whole life cycle. Product side: the company has a complete product line and continues to enrich product categories through acquisition and R & D. During the reporting period, the company acquired Jirui and beibeijia brands, and launched uric acid detection products, Helicobacter pylori rapid detection test paper, sodium hyaluronate repair patch and other products, which is expected to further increase revenue and profit. There are abundant projects under research, and covid-19 detection series products (including antigen and antibody) independently developed have entered the production conversion stage; Online + offline channel construction and improvement. In terms of offline channels, the cooperation with head pharmacy continues to deepen, and the three types of self operated stores complement each other. In terms of online channels, e-commerce business is leading in the industry and has strong supply chain management ability. Good nurses’ medical devices in online self-supporting stores have been put on the shelves. Covid-19 antigen self-test products of Nanjing Vazyme Biotech Co.Ltd(688105) , Beijing Hotgen Biotech Co.Ltd(688068) and other manufacturers have been put on the shelves; On the service side, the company actively develops hearing fitting stores. By the end of 2021, the number of stores has exceeded 300, with strong profitability and replicability. After years of accumulation, the company has formed a strong “Kefu” brand, and many kinds of products have the ability to continuously raise prices. With the acceleration of the company’s production expansion and the rising proportion of private brands, Kefu is expected to become a comprehensive service provider of personal health management in the whole life cycle in the future.
Profit forecast
We predict that from 2021 to 2023, the company’s revenue will be 2.468 billion yuan, 3.319 billion yuan and 4.311 billion yuan, with a year-on-year growth rate of 3.9%, 34.5% and 29.9%. From 2021 to 2023, the company’s net profit attributable to the parent company will be 427 million yuan, 565 million yuan and 730 million yuan, with a year-on-year growth rate of 0.7%, 32.2% and 29.3%. The corresponding EPS will be 2.66, 3.52 and 4.55 yuan. The corresponding P / E of the current stock price is 24.61, 18.61 and 14.39 times. There is a large market space for household medical devices, and the company’s performance is expected to achieve high growth. In addition, the company vigorously develops the offline fitting stores of Jianer hearing, which has a large growth space in the future, and gives a “buy” rating for the first time.
Risk tips
Core technology disclosure risk, new product R & D risk, management risk caused by business scale expansion, intellectual property risk, etc.
