Overview of events

The company released its semi-annual report in 2022, with operating income of 668 million yuan (+ 33.63%), net profit of 103 million yuan (+ 93.10%) and non-return net profit of 102 million yuan (+ 95.66%). The performance is located in the center of the forecast.

High growth is still achieved under the influence of the epidemic of core products

According to the semi-annual report, the company's income from market services and other projects (mainly injecting 12 vitamins) was 481 million yuan, an increase of 37.8% over the 349 million yuan of 2021H1; the income of 84 million yuan from various trace elements increased by 302% over the same period last year; and the income of children's multivitamin 13 was 20 million yuan, up 54.74% from the same period last year. With the easing of the control of the epidemic, we expect that several core varieties of the company will further accelerate the release.

Investment suggestion

In the first half of 2022, under the circumstances of relatively strict control of the epidemic and the decline in the volume of services provided by medical institutions, the company's sales revenue also grew strongly and raised its profit forecast. It is expected that the company's operating income will remain unchanged from 2022 to 2024, which will be 2.542 billion yuan, respectively, and that the EPS will be adjusted from 0.33 to 0.64 to 0.40, 0.61 and 0.85 in 2022-2024, respectively, corresponding to the closing price of 13.20 yuan per share on August 22, 2022, and PE will be times that of 33-22-15.

Risk hint

Core product health insurance price reduction risk, new product promotion less than expected risk, collection risk