\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 085 Beijing Tongrentang Co.Ltd(600085) )
Main points:
Events
Beijing Tongrentang Co.Ltd(600085) disclosed the report of the first quarter of 2022. During the reporting period, the company achieved an operating revenue of 3.954 billion yuan, an increase of 6.67% year-on-year; The net profit attributable to shareholders of listed companies was 400 million yuan, with a year-on-year increase of 25.61%; The net profit attributable to shareholders of listed companies after deducting non recurring profits and losses was 396 million yuan, a year-on-year increase of 25.14%.
Event comments
The profit side grew faster than expected, and the growth rate of net profit attributable to the parent company was significantly higher than that of revenue
In 2022q1, in the face of China, Hong Kong and foreign market environment, covid-19 epidemic and other factors, the overall operating revenue still maintained a growth trend. Especially on the profit side, the net profit attributable to shareholders of listed companies increased by 25.61% year-on-year. According to the company’s analysis, the increase of net profit was higher than that of operating revenue due to various fine management and cost control.
Business indicators have improved, and time-honored brands are steadily improving
The cost side control effect is remarkable. By splitting the expense side changes, the overall gross profit margin of 22q1 company was 48.25%, a year-on-year increase of + 1.52 percentage points; The expense rate during the period was 29.67%, with a year-on-year increase of + 0.36 percentage points; Among them, the sales expense rate was 19.83%, with a year-on-year increase of + 0.87 percentage points; The rate of administrative expenses was 9.77%, with a year-on-year increase of -0.38 percentage points. In terms of operating capacity, 22q1 business cycle (293 days), inventory turnover days (266 days) and accounts receivable turnover days (27 days) have reached new lows in recent years. It can be seen that the company’s operating capacity has continued to improve after the “4 + 2” business reform.
The retail end is basically stable, and the R & D end continues to be promoted
Retail stores: by the end of 2021, Beijing Tongrentang Co.Ltd(600085) commerce had set up 920 retail stores, and 42 new stores were set up during the reporting period. Among the retail pharmacies, 560 have set up TCM medical clinics, 699 have obtained the qualification of “designated retail pharmacies for medical insurance”, and the designated pharmacies with medical insurance account for 75.98% of the total number of stores.
R & D: R & D expenses in 22q1 increased by 107.24% year-on-year, due to the increase of R & D expenditure due to the company’s increased R & D investment. According to the disclosure of the company’s annual report in 2021, the company carried out research around the development of innovative products, cultivation of famous and high-quality varieties, tackling key production and quality problems, construction of medicinal material traceability system, common technology reserve and inheritance and development of processing technology. According to the catalogue of classic famous prescriptions, 10 varieties developed in advance were screened and determined. And carry out the secondary development and research of Tongren Niuhuang Qingxin pill, Angong Niuhuang Pill, Tongren Wuji Baifeng pill, Morinda officinalis oligosaccharide capsule and Wuziyanzong pill.
Investment advice
We maintain the previous forecast. We predict that the company’s revenue from 2022 to 2024 will be RMB 17.09/197.4/22.75 billion respectively, with a year-on-year increase of 17.0% / 15.5% / 15.3% respectively, and the net profit attributable to the parent company will be RMB 1.57/17.7/2.02 billion respectively, with a year-on-year increase of 27.5% / 12.9% / 14.5% respectively, with a corresponding EPS of RMB 1.14/1.29/1.47 and a corresponding valuation of 32x / 28x / 25X. Maintain the “buy” investment rating.
Risk tips
Price fluctuation of raw materials; The price increase of core varieties is less than expected; Marketing reform was less than expected.
