\u3000\u30 Xuchang Ketop Testing Research Institute Co.Ltd(003008) 88 Winner Medical Co.Ltd(300888) )
Strategic acquisition of Hunan Ping An medical equipment, creating a one-stop solution for medical consumables and maintaining the “buy” rating
On May 17, 2022, the Winner Medical Co.Ltd(300888) board of directors deliberated and passed a proposal and decided to acquire the controlling interest of Hunan Ping An medical with a total capital of 750 million yuan and unilaterally increase the capital. After this transaction, the company holds 68.7% equity of Hunan Ping An medical equipment. Hunan Ping’an Medical Equipment Co., Ltd. is an enterprise mainly engaged in R & D, production and sales of injection and puncture products. Injection puncture is the largest category of low-value medical consumables in China. This acquisition complements the blank of Winner Medical Co.Ltd(300888) in the low-value medical consumables market and helps Winner Medical Co.Ltd(300888) become one of the most comprehensive enterprises in China’s medical consumables product line. We maintain the profit forecast. It is estimated that the net profit of the company from 2022 to 2024 will be RMB 1.429/1.714/1.978 billion respectively, the corresponding EPS will be RMB 3.35/4.02/4.64, and the PE corresponding to the current stock price will be 18.3/15.3/13.2 times respectively. The company’s medical sector and consumer sector are driven by two wheels, and its products remain in the lead. Through investment and M & A, it is optimistic about the long-term steady growth of performance and maintains the company’s “buy” rating.
Hunan Ping’an medical equipment has excellent profitability and broad market space for puncture and injection products
(1) Hunan Ping An medical equipment was established in 2010. Its main business is the R & D, production and sales of medical devices such as syringes, infusion sets, blood collection vessels, blood collection needles and indwelling needles. It has a leading market share in the hospital market of Hunan Province. In 2021, Hunan Ping An medical equipment achieved a revenue of 360 million yuan and a net profit of 85 million yuan; In 2022q1, the revenue was 78 million yuan and the net profit was 17 million yuan. The net interest rate remained at a high level. (2) According to the research and analysis of IBM and medical equipment exchange, it is estimated that the market scale of low-value medical consumables in China will reach 221.3 billion yuan in 2025, of which puncture and injection products account for about 28%, belonging to the largest category. With the aging of China’s population and the increase of new medical scenes, the growth prospect of injection and puncture industry is broad.
Winner Medical Co.Ltd(300888) medical business: scale and synergy appear, increasing the market share of core products
Winner Medical Co.Ltd(300888) medical business revenue in 2021 was 3.922 billion yuan, an increase of 161% over 2019. In terms of the proportion of revenue in 2021, about 39% of overseas, about 32% of hospitals, and about 30% of OTC pharmacies and e-commerce. The revenue of Chinese hospital channel in 2021 was 1.25 billion yuan (+ 12%), an increase of more than 500% over 2019. At present, Winner Medical Co.Ltd(300888) has more than 4000 hospital customers. After purchasing Hunan Ping’an medical equipment, it can form more combination packages of puncture and injection products with Winner Medical Co.Ltd(300888) original operating room consumables and wound care products, provide hospital customers with one-stop customized solutions, and form scale and synergy with the advantages of customers, products, R & D and production of both sides. The company will also increase the market share of other core products such as disposable combination bags, plane masks, N95 masks and protective clothing.
Risk tip: channel expansion is less than expected, new product sales are less than expected, and industry competition intensifies.
