\u3000\u30 Beijing Zznode Technologies Co.Ltd(003007) 60 Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) )
Event: on April 20, the company released its annual report for 2021, realizing an operating revenue of 25.270 billion yuan (+ 20.18%), a net profit attributable to the parent company of 8.002 billion yuan (+ 22.19%), and a non net profit attributable to the parent company of 7.85 billion yuan (+ 20.04%).
Overseas is still growing under the high base last year, and China’s rapid growth is driven by new infrastructure. The revenue of Q1 / Q2 / Q3 / Q4 increased by 21.93% / 20.16% / 20.25% / 18.46% respectively year-on-year. The growth is mainly driven by the Chinese market. The Chinese market revenue is 15.259 billion yuan (+ 37.34%), benefiting from the overall stability of the new medical infrastructure and the epidemic situation in China, the overall stability of the epidemic situation in China, the gradual normalization of the routine diagnosis and treatment activities of the hospital and various businesses of the company, and the steady growth of China’s revenue thanks to the new medical infrastructure projects gradually carried out in China. China’s in vitro diagnosis and medical imaging production lines have achieved rebound growth of more than 35% and more than 25% respectively due to the significant recovery of routine procurement. Overseas market revenue was 10.02 billion yuan (+ 1.01%). In terms of overseas sales regions, the revenue of Asia Pacific region is 2.174 billion yuan (+ 39.54%), and that of North America is 1.872 billion yuan (+ 11.70%). In addition, due to the high base in 2020 and the uncertain global epidemic situation, the income of Europe is 2.278 billion yuan (- 1.65%), that of Latin America is 1.568 billion yuan (+ 2.55%), and that of other regions is 2.129 billion yuan (- 25.53%).
In vitro diagnosis and medical imaging led the growth, with blood cells and ultrasound ranking first and second in China respectively. In 2021, the three main businesses of the company maintained stable growth, and the revenues in the field of life information and support, in vitro diagnosis and medical imaging were 11.153/84.49/5.426 billion yuan respectively, with a year-on-year increase of 11.47% / 27.12% / 29.29% respectively. The high growth of medical imaging and in vitro diagnosis is due to the gradual recovery of hospital diagnosis and treatment activities and routine procurement in China and some international regions, and the continuous recovery of routine diagnosis procurement demand. In terms of growth factors, 1) in vitro diagnosis: excluding luminescent reagents, in vitro diagnosis increased by more than 40%. The consumption of conventional reagents has recovered significantly. The new bc-7500crp automatic blood analyzer has more than 1000 units installed throughout the year, and the blood cell business has surpassed the imported brand to become the first in China for the first time, driving the rapid growth of in vitro diagnosis business. 2) Medical imaging: the recovery of conventional ultrasound procurement has driven the restorative high growth of medical imaging business. The ultrasound business has surpassed the imported brand for the first time and become the second in China. 3) Life information and support: in 2020, the high base growth of life information and support business benefited from the demand of the epidemic. In 2021, China’s demand came from the gradual development of new medical infrastructure and the rapid development of emerging businesses such as AED and minimally invasive surgery, which continued a good growth trend.
R & D continued to invest, launched many new products, and acquired in vitro diagnostic companies to complete the product line. In 2021, the company invested 2.524 billion yuan in R & D, and the R & D expense rate was 9.99%, with a year-on-year increase of 35.05%. The number of medical device registration certificates is 879 (22.77%), and the medical devices in the registration application include 125 nmpa registration applications, 2 FDA registration applications and 2 CE registration applications. In terms of project areas, 1) in the field of life information and support: the company has launched new products such as new platform operating table hybasev8 (CE), hyportr80 new suspension bridge type I (CE / CFDA), 4K digital operating room (CFDA), single hole puncture device / Hansen puncture device (CE), incision protective sleeve (CE). 2) In vitro diagnosis: the company has launched three-dimensional fluorescence, full-automatic peripheral blood, high-speed CRP and SAA detection integrated machine, bc-7500cs series blood cell analyzer, MC-80 full-automatic cell morphology analyzer, cl-8000i full-automatic chemiluminescence immunoanalyzer, bs-2800m full-automatic biochemical analyzer and other new products. 3) In the field of medical imaging, it mainly launched new products such as comprehensive ultrasound application solution “Kunlun R7”, women’s and children’s application solution “Nuwa R7”, POC high-end flat-panel color ultrasound te9, medium and low-end desktop color ultrasound shear wave solution (dc-70, dc-60ultra). The company wholly acquired 100% equity of hytest, the world’s leading supplier of in vitro diagnostic antigen and antibody. Hytest has accumulated research and development of raw materials and an excellent scientific research team. After the merger, the company further improved its R & D capacity in the field of in vitro diagnosis.
Profit forecast and investment rating: Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) as a leading company in the field of medical devices, it is expected to fully benefit from the new medical infrastructure. In the post epidemic era, governments of various countries have increased investment in medical infrastructure, which is also conducive to the expansion of the company’s overseas business. The three main businesses of the company have grown steadily and reached the leading level in China in their respective segments. Among them, the global market share of monitor, anesthesia machine, ventilator, blood cell and ultrasonic testing all occupy the top five positions. In addition, chemiluminescence performance is growing rapidly, and there is a large market demand space for minimally invasive surgery and veterinary products in emerging strategic businesses, which is expected to provide new momentum. In the long run, the company is expected to go further on the basis of China’s leading and become a global head medical device company. We expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 9.629/11.496/13.696 billion, EPS to be RMB 7.92/9.39/11.27 respectively, and corresponding PE to be 41.45/34.98/29.14 times respectively, giving the investment rating of “buy”.
Risk tips: the impact of the epidemic is more than expected, Sino US trade friction risk, centralized purchase and price reduction risk, exchange rate risk, new product research and development is less than expected, and supply chain risk.
