Key investment points:
Monthly core view in January. In 2022, the pharmaceutical industry has the following three trends: 1) the prevention and control experience of covid-19 epidemic has matured, covid-19 drugs have been listed, and the epidemic prevention and control has entered the second half. With the emergence of Omicron variant virus, “vaccine + covid-19 drugs” has become the main means of anti epidemic in the future. It is suggested to pay attention to investment opportunities in the field of vaccines and covid-19 drugs, Key companies include Chongqing Zhifei Biological Products Co.Ltd(300122) (300122), Walvax Biotechnology Co.Ltd(300142) (300142), Cansino Biologics Inc(688185) (688185), Shenzhen Kangtai Biological Products Co.Ltd(300601) (300601), Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) (603392), Shanghai Junshi Biosciences Co.Ltd(688180) (688180); 2) The development of innovative drugs has entered a breakthrough innovation stage, and the valuation of CXO has been adjusted a lot. With the disclosure of the annual report, we can continue to pay attention to the investment opportunities of CXO, and it is suggested to focus on Joinn Laboratories (China) Co.Ltd(603127) (603127); 3) The reform and innovation of DRG / Dip medical insurance payment mode is accelerated, and the substitution of domestic devices may be accelerated. It is suggested to focus on Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) (300760); The development of the third party in the hospital is accelerating. It is suggested to pay attention to Shanghai Runda Medical Technology Co.Ltd(603108) (603108); The outflow of prescriptions accelerates. It is suggested to pay attention to Lbx Pharmacy Chain Joint Stock Company(603883) (603883), Yifeng Pharmacy Chain Co.Ltd(603939) (603939), Yixintang Pharmaceutical Group Co.Ltd(002727) (002727), Dashenlin Pharmaceutical Group Co.Ltd(603233) (603233) and Yunnan Jianzhijia Health-Chain Co.Ltd(605266) (605266). In addition, it is suggested to focus on investment opportunities in the field of traditional Chinese medicine, focusing on Dong-E-E-Jiao Co.Ltd(000423) (000423) and Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) (600436).
Market review: from the perspective of the whole year, in 2021, the pharmaceutical and biological industry rose by 11.51% as a whole, underperforming Shanghai and Shenzhen 300 by 0.47 percentage points. The overall performance of the industry ranked eighth from the bottom among the 28 Shenwan industry indexes, with poor performance.
Valuation analysis of pharmaceutical industry. From the PE trend of Shenwan biomedical index in recent ten years, as of January 19, 2021, the dynamic PE of the industry was 33.32 times, which was at a relatively low level in recent 10 years, showing a volatile trend compared with the previous month. Due to the normalization trend of epidemic prevention and control, the investment rating of “synchronous big market” of the industry was given. However, different sub industries are also divided.
Risk tip: the epidemic situation and virus variation exceed expectations, China US political risk and national policy change risk
