\u3000\u30 China Baoan Group Co.Ltd(000009) 99 China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) )
Events
In the first quarter of 2022, the company realized an operating revenue of 4.194 billion yuan, a year-on-year increase of 2.81%; The net profit attributable to the parent company was 839 million yuan, a year-on-year increase of 30.45%; Net profit deducted from non parent company was 797 million yuan, with a year-on-year increase of 27.96%.
Event comments
The profit side exceeded expectations, and the decline of expense rate brought rapid profit growth. The overall gross profit margin of the company was 55.06%, a year-on-year increase of – 4.40 percentage points; The expense rate during the period was 30.00%, with a year-on-year increase of -9.33 percentage points; Among them, the sales expense rate was 23.23%, with a year-on-year increase of -9.96 percentage points; The management fee rate was 6.98%, with a year-on-year increase of + 0.51 percentage points; The financial expense rate was – 0.22%, with a year-on-year increase of + 0.12 percentage points; The net operating cash flow was 459 million yuan, a year-on-year increase of + 64.73%.
The revenue side continues to recover. In terms of revenue in the last three quarters, the revenue of 21q3, 21q4 and 22q1 in a single quarter was 3.343 billion yuan, 4.221 billion yuan and 4.194 billion yuan respectively, with a year-on-year growth rate of – 2.70, – 2.38 and + 2.81% respectively. It continues to recover under the influence of the epidemic. The advantages of big brands are obvious, and R & D continues to advance. As the core business of the company, CHC has achieved rapid growth. Cold medicine constantly strengthens the brand and expands online channels. Sanjiu brand has obvious advantages. The business of Chinese specialty prescription drugs and Chinese medicine formula granules has achieved rapid growth. In terms of R & D, the product layout is based on the combination of imitation and innovation in strategic areas such as cancer, orthopedics, skin, respiration and anti infection.
Investment advice
Maintain the previous profit forecast. We expect that the company’s revenue from 2022 to 2024 will be 17.83/207.2/24.15 billion yuan respectively, with a year-on-year increase of 16.4% / 16.2% / 16.6% respectively, and the net profit attributable to the parent company will be 23.5/26.0/2.9 billion yuan respectively, with a year-on-year increase of 14.6% / 10.8% / 11.4% respectively, with a corresponding EPS of 2.40/2.66/2.96 yuan and a corresponding valuation of 14x / 13X / 12x. Maintain the “buy” investment rating.
Risk tips
Industry policy risk is lower than expected; The promotion of new varieties is not as expected; The impact of the epidemic exceeded expectations.
