\u3000\u3 Shengda Resources Co.Ltd(000603) 987 Shanghai Kindly Enterprises Development Group Co.Ltd(603987) )
Summary of this issue:
Event: the company issued the 2021 annual report. In 2021, the annual revenue was 3.097 billion yuan, a year-on-year increase of + 17.07%, and the net profit attributable to the parent company was 291 million yuan, a year-on-year increase of + 43.71%. The net profit attributable to the parent company after deducting non capital was 257 million yuan, a year-on-year increase of + 39.23%. In the fourth quarter of 2021, the revenue was 883 million yuan, a year-on-year increase of + 26.72%, and the net profit attributable to the parent company was 79 million yuan, a year-on-year increase of + 54.82%.
Comments:
The overseas epidemic has promoted the rapid growth of the company’s performance and the continuous upgrading of products. The company is one of the few manufacturers with a complete industrial chain of medical puncture instruments in China. With the continuous overseas epidemic, the main business of the company has achieved significant growth by actively expanding the market outside China. In 2021, the company’s overseas revenue reached 1.042 billion yuan, a year-on-year increase of 24.91%. At the same time, the company accelerates the R & D and upgrading of product pipelines through cooperation with well-known foreign enterprises, and continuously promotes technology and product iterations and breakthroughs.
Rapidly increase China’s market share and brand with the help of centralized purchase. With the in-depth implementation of the national medical insurance fee control reform, the centralized procurement bidding of medical devices has become the norm. The company’s indwelling needle, functional infusion set and other products have been included in the centralized procurement catalogue of medical consumables, and have achieved good results in the bidding process in Hebei, Shandong, Jiangsu, Qinghai, Fujian, Shanxi, Hunan and other places. In addition to rapidly increasing the market share of relevant regions, the winning products also drive the sales of other products of the company, So as to further expand and enhance the influence and coverage of the company’s brand. In addition, with the continuous improvement of China’s insulin needle penetration rate, the company’s insulin needle products are expected to be replaced by domestic products with the advantage of higher cost performance.
New products continue to be launched, opening up room for future growth. The listing of the company’s new products provides support for the company’s growth. Among them, the disposable beauty package has been registered in China and launched for sale, and the follow-up medical and beauty equipment products are under development and registration; The 510k registration submission of disposable safety injection needle, disposable safety syringe and other products has been completed, and iterative products such as disposable pump syringe, disposable drainage bag, safety indwelling needle, safety injection needle, safety blood collection needle, safety insulin pen supporting needle, disinfection cap, non sterile blood collection vessel and improved dosing syringe will also be listed one after another. In the future, the continuous listing of medical and aesthetic devices, safety injection and intervention products will further provide broader growth space.
Profit forecast and investment rating: we predict that the company’s operating revenue from 2022 to 2024 will be RMB 38.51/47.08/5.665 billion respectively, with a growth rate of 24.3% / 22.3% / 20.3%, and the net profit attributable to the parent company will be RMB 390 / 485 / 585 million respectively, with a growth rate of 34.0% / 24.2% / 20.5%, and the corresponding PE will be 19 / 15 / 13X respectively.
Risk factors: trade friction risk, China’s centralized procurement policy exceeded expectations.
