Main points:
Regional characteristics, going to the whole country
Teyi Pharmaceutical Co., Ltd. is a comprehensive pharmaceutical group company integrating pharmaceutical research and development, pharmaceutical industry and pharmaceutical commerce. The core products are Zhike Bao tablets, the main products include dermatosis Xuedu pills, Xiaoer Kechuanling granules, Jinkui Shenqi tablets, Jiangtang Shu pills, Pudilan Antiphlogistic tablets, Ganmaoling granules, Xuesaitong dispersible tablets, Ginkgo biloba dispersible tablets, Yixinshu granules, magnesium bicarbonate chewing tablets, Fengliao Changwei Kang tablets, omeprazole enteric-coated capsules, etc. The company evolved from Guangdong Taicheng Pharmaceutical Co., Ltd., and was listed on the Shenzhen Stock Exchange in 14 years. Family enterprise, the Xu family directly controls nearly 50% of the shares, and the current chairman of the company, Xu Danqing, has long been engaged in the trade of medicinal materials and other businesses with profound qualifications. Although total revenue, net profit and gross profit margin were greatly affected by the epidemic in 2020, since 2021, it has been gradually getting rid of the impact of the epidemic, and the financial situation continues to improve.
With the help of the development of spring breeze of traditional Chinese medicine, the core product Zhike Bao tablet is bigger and stronger. In 2021, the Chinese medicine policy ushered in an explosive period, and the relevant important policies fell to the ground one after another. Traditional Chinese medicine industry is an important component of China's pharmaceutical industry, and the market scale is huge. Among them, the prosperity of proprietary Chinese medicine market is obviously upward, whether at the production end, the hospital end or at the retail end. Kebao tablet of Teyi Pharmaceutical Co., Ltd., as the company's exclusive product, has a long history of nearly a hundred years. The curative effect is outstanding, it has a significant effect on various types of chronic cough, and its side effects are very low. it ranks among the top five in the market of antitussive and expectorant Chinese patent medicine in China. The gross profit margin of the product has been maintained at around 80%. According to the company announcement, 2500 million boxes (about 330 million yuan) of Zhikebao tablets are expected to be sold in 2022. In the favorable market space and competition pattern, it is expected to achieve a further huge leap.
Teyi adheres to the multi-variety common development strategy and actively creates the "1x N" product line matrix. in addition to the core products Zhike Bao tablets, Teyi adheres to the multi-variety common development strategy and actively creates the "1th N" product line matrix. "1" is the main variety of Zhikebao tablets. "N": under the background that the national industrial policy strongly supports the development of the traditional Chinese medicine industry, the company plans to keep up with the general trend of national reform and development, and make efforts in the three major directions of proprietary Chinese medicine, chemical medicine and chemical raw material medicine at the same time. Focus on the development of proprietary Chinese medicine varieties, cultivate skin disease blood poison pills and Jiangtangshu pills as major varieties after Zhike Bao tablets, actively develop chemical preparations, participate in consistency evaluation, collection and bidding in hospitals, and increase the company's product marketing channels. at present, 11 products of the company have passed the consistency evaluation, and other projects are being promoted as planned. At the same time, increase the market promotion of API, improve the market share of existing API products.
Investment suggestion
We estimate that the company's revenue in 2022 to 2024 is 9.2 billion yuan respectively, an increase of 21.2%, 22.8%, 20.8%, and a year-on-year increase of 1.8 million, 2.533 million, and 42.1%, 35.7%, 35.1%, respectively, corresponding to an EPS of 0.81, 1.11, 1.50 and a corresponding valuation of 16X/12X/9X. Coverage for the first time, giving a "buy" investment rating.
Risk hint
Policy change risk; drug price reduction risk; management risk.