\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 223 Lushang Health Industry Development Co.Ltd(600223) )
Key investment points
The company released the first quarterly report of 22 years, and the real estate business disturbed the scale of revenue. 2022q1 achieved revenue of 1.482 billion / yoy-13.08%, real estate business revenue of 856 million / yoy-31.85%, disturbed the volume of revenue, and the company promoted the transformation to great health, with cosmetics revenue of 419 million / yoy + 95.31%, medicine revenue of 90 million / yoy-25.74%, raw materials and additives of 77 million / yoy + 3.96%. Cosmetics in non real estate business performed well, with a net profit attributable to the parent of 66 million / yoy-22.74%, and a net profit attributable to the parent of 63 million / yoy-23.92%. Freida Pharmaceutical (consolidated) has a revenue of 541 million / yoy + 49% and a net profit attributable to the parent company of 32 million / yoy + 0.19%.
The adjustment of sales structure promoted the significant increase of gross profit margin. The gross profit margin in 2022q1 was 41.06% / + 8.41% PCTs. The proportion of the revenue of cosmetics business with high gross profit (61.56% in 22q1) increased to 28%, 16 PCTs higher than that in 2021. The gross profit margin of pharmaceutical and raw materials business was 55.46% and 34.63% respectively, which was relatively stable. In terms of expense ratio: (1) the sales expense ratio is 20.01% / + 7.58pcts. With the increase of the proportion of medicine and cosmetics business, the company will improve its brand publicity and product promotion; (2) The management fee rate is 5.08% / + 0.05pcts; (3) The R & D expense rate is 1.51% / + 0.14pcts. The company carries out research on traditional Chinese medicine in orthopedics, ophthalmology, skin and other fields, and produces "traditional Chinese medicine +" functional food; The raw material side has newly developed four kinds of products such as ekdoyne, and listed a number of hyaluronic acid derivative products. In the future, it will continue to promote the development of new products and the promotion of the new brand "Baifu".
Cosmetics: "4 + n" operation continues the high growth trend. The multi-point layout in the three fields of skin care, fragrance and make-up has built a collaborative brand cluster with the "4 + n" strategy, and the operation effect of cosmetics business has been gradually realized. (1) Dr. yu'er: differentiated positioning of micro ecological skin care, 22q1 achieved a revenue of RMB 225million. Based on the strong scientific research strength of Freida, it has created four popular products, namely, cleansing honey, banana facial mask, probiotic water emulsion and leading essence, and launched a new product of "flash charging essence". With China's first and exclusive dual bacteria fermentation brown algae technology, it has become the top one in the best-selling list of tmall Anti Wrinkle Essence; The channel is fully covered both online and offline. The new retail system of single brand stores + Business District stores is distributed across the country offline. The Tiktok channel is rapidly growing and Q1 is performing well. In the future, it will use the channel to further cultivate the micro ecological skin care field. (2) Yilian: with a revenue of 162million yuan in 22q1, it launched the upgraded product of hyaluronic acid spray 2.0 and sold 20000 bottles on the same day, continuing the development trend of popular spray products. It has launched a number of "hyaluronic acid + fullerene" composite products and gradually improved the product matrix. (3) Sub brand: Shanyan focuses on precision skin care and accelerates the marketing mode of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integration through the expansion of offline brand stores; EPAR Khan focuses on the field of fragrance; In the future, with the four major brands as the core, relying on the core advantages of "homology of makeup drugs and skin beautification through science and technology", and with R & D as the empowerment, we will create many sub brands, such as quanrun (weak sensitive skin repair), UMT (skin nourishing base makeup), beirun (anti-aging and skin beautification).
Investment suggestion: the company transformed into a large health field, with a high boom hyaluronic acid track, and continued to realize its business supported by the "4 + n" cosmetics matrix. Considering the decline in the price of food and cosmetics hyaluronic acid caused by the intensification of competition in raw material business and the disturbance of real estate business by price factors, the net profit for 22-24 years was adjusted to 521 million / 676 million / 797 million, and the corresponding valuations were 17x / 13X / 11x respectively, maintaining the "buy" rating.
Risk tips: there is a risk of declining prosperity in the cosmetics industry, increased competition in the cosmetics industry, the promotion of new products is less than expected, and the real estate policy is tightened.
