\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 763 Topchoice Medical Co.Inc(600763) )
Investment logic
China’s dental medical service industry leader, three rounds of expansion, explore different development paths, flexibly use a variety of mature operation modes, and jointly promote the steady improvement of the company’s profitability. The company entered the oral medical service track by participating in the restructuring of public hospitals. After mergers and acquisitions of many mature hospitals, the company achieved good results and built high-quality general hospitals such as Pinghai hospital, Chengxi hospital and Ningbo Oral Hospital of Hangzhou oral hospital. The “general hospital + branch hospital” mode promoted by the company will coordinate the operation of hospitals of different levels, and give full play to the advantages of institutions at all levels; The CM team model fully improves the service experience and significantly improves the operation efficiency. The output value of single dental chair in Chengxi hospital area, which widely applies the team model, has reached 1.49 million yuan in H1 in 2021, with a year-on-year increase of 52.8%, 2.4 times the average level of the whole company in the same period; The company continued to strengthen the construction of scientific research and academic system, which promoted the virtuous circle of talent reserve.
Expand the “Dandelion plan” in the province and build the “cunji” brand outside the province. The company has gradually accelerated the layout of stores, promoted the “Dandelion plan” and sunk high-quality dental medical resources to major counties (cities and districts) in Zhejiang Province. As of March 2022, the company has 42 hospitals in operation, 8 hospitals to be opened and 12 proposed hospitals in the province. While improving the penetration rate in the province, the company has further implemented the mode of “regional general hospital + branch hospital”. Outside the province, the company has successively arranged high-standard cunji stomatological hospital in six key cities with relatively rich stomatological medical resources. Among them, Wuhan cunji hospital, which took the lead in opening, has achieved an operating revenue of 44.09 million yuan in 2020. It is expected that in the future, with six general hospitals as the core, try to set up multiple branches locally to expand the new direction of replication outside the province.
Profit forecast and investment suggestions
Considering the long-term stable operation and outstanding performance of the company’s core general hospital, the dandelion high-quality branch in the province has strong profitability, and the “general hospital + branch” model is expected to contribute to long-term growth, we expect the company’s net profit attributable to the parent company from 2021 to 2023 to be 750 million yuan, 1.04 billion yuan and 1.41 billion yuan respectively, with a year-on-year increase of 51.28%, 35.60% and 36.43% respectively, corresponding to 86 times, 62 times and 45 times of PE, and the target price within 12 months is 155 yuan / share, Maintain the “overweight” rating.
Risk tips
Risk of medical service disputes; The new store expansion is less than the expected risk; The risk of intensified industry competition; The risk of co19-vid pneumonia; Policy environment risk
