\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 223 Lushang Health Industry Development Co.Ltd(600223) )
Investment logic
"Bio medicine + health real estate" is driven by two wheels, with diversified development and steady progress: in 18 and 19 years, the company successively acquired Freida Pharmaceutical Group and focus biology to enter the pharmaceutical and cosmetics business with stronger profitability. In the 21st year, the real estate / biomedical revenue was 10.18/2.18 billion yuan, a year-on-year increase of - 18% / + 67%, accounting for 82.4% / 17.6%; The net profit attributable to the parent company was RMB 182180million, accounting for 50.3%/49.7% and the net interest rate was 1.8%/8.3%. The biomedical sector benefited from the rapid growth of cosmetics business and contributed nearly half of the profits. In 2021, the net profit attributable to the parent company was 362 million yuan (- 43.3%), and the net interest rate was 3.19 (- 1.5pct).
With the concept of pharmaceutical research and development of cosmetics, Dr. Yilian and Dr. yu'er are riding the wind: the efficacy skin care track is booming. The market scale of China's efficacy skin care products is 25.06 billion yuan in 2021 and cagr28.5 billion yuan in 201621 7%, higher than the growth rate of 12.8% of the skin care market in the same period. The company's cosmetics business relies on the resources and scientific research advantages of Freida to build technical barriers & strong product strength. The brand positioning of Yilian and Dr. Tuoer is clear. A variety of single products are out of the circle, leading the hyaluronic acid / micro ecological technology skin care track respectively. A relatively mature playing method has been formed in product development, brand marketing and single product manufacturing, and the annual revenue is expected to be 700 / 800 million yuan respectively in 22 years. In the future, we will strive to build a "4 + n" brand matrix, focusing on incubating high-end customized skin care brand Shanyan and essential oil brand yipahan; The introduction of strategic investors is expected to enable channel expansion, brand building and enhance the competitiveness of cosmetics business. In the 21st year, the cosmetics revenue was 1.495 billion yuan (+ 117%), the CAGR from 2018 to 2021 was 89.1%, and the net profit rate of Freda biology in the 21st year was 11.35%, which was in the middle and upper reaches of the industry.
The growth of drugs is steady, and the strength of products enabled by raw materials and additives is upgraded: the drug business has advantages in the fields of modern Chinese patent medicine, hyaluronic acid ophthalmology and orthopedics. It has well-known brands such as runshu / Runjie / Mingren / spete. 2h21 will increase the promotion and increase the market share, which is expected to maintain steady growth. According to the announcement of the prospective research institute and the company, focus Freda has a production capacity of 420 tons / year of food grade and cosmetic grade hyaluronic acid, the second largest market share in the world, second only to Bloomage Biotechnology Corporation Limited(688363) of 470 tons / year, and obtained the drug grade production license of hyaluronic acid in January 22. The company has a number of exclusive core raw materials for cosmetics, and launched a new brand of raw materials in 21 years. The strength of Baifu beneng cosmetic grade hyaluronic acid products has been improved. In 21 years, the revenue of raw materials and additives was 240 million yuan, + 22%.
Valuation and investment advice
We are optimistic about the continued high growth of cosmetics business and the optimization of profitability. Using the segment valuation method, it is estimated that the reasonable valuation of cosmetics / drugs, raw materials and additives / real estate sector in 22 years will be RMB 84 / 12 / 1.56 billion, the overall reasonable valuation will be RMB 11.16 billion, and the target price will be RMB 11.1/share. The "buy" rating will be given for the first time.
Risk
Real estate policy regulation risks, intensified competition in the cosmetics industry, and the incubation of new brands is less than expected.
