The company predicts revenue growth of 75.8-90.4% year-on-year to about 24—260 million yuan in 2022, with an annual implantation volume of about 1,200 units, in line with management's previous annual revenue of 25—30 million yuan and implantation volume of no less than 1,200 units, although revenue was slightly lower than market expectations of 270 million yuan. We fine-tuned our performance expectations based on the company's 2022 revenue forecast, continued to give the company's stock a “buy” rating, and maintained a target price of HK$14.0.
The company predicts revenue growth of 75.8-90.4% year-on-year in 2022 to about 24—26 million yuan (management expects the final revenue may slightly exceed 250 million yuan), its central valve products will be about 110 million yuan (+ about 163% YoY), and neurological intervention will be about 140 million yuan (+about 50% YoY). The annual implant volume was about 1,200 units (+ about 314% YoY), and the number of units shipped was less than 100 units higher than the number of implants. The company's implant volume in January 2023 has not improved significantly month-on-month. Management expects it will still take 1-2 months to recover. Demand for implants previously delayed due to the pandemic may be released at an accelerated pace from the mid/end of the first quarter of this year.
Financial Forecast: As a result, we adjusted our financial forecast accordingly, lowering 2022 revenue by 7.7% to 254 million yuan, and adjusting the net loss of the mother to 380 million yuan. Since the recovery of implants in 2023 may be slightly earlier than we anticipated (SPDBI anticipates 2Q23 vs. management anticipates 1Q23 mid/end), we slightly increased 2023/24E revenue by 1% to 435 million/682 million yuan.
Valuation: We continue to use DCF to value the company. The WACC & sustainable growth rate assumption is the same as before (WACC: 11x; sustainable growth rate: 3%), maintaining the target price of HK$14.0, and continuing to use Peijia as the first choice for intervention in the valvular heart sector.
