Events:
Watt Dain issued the 2022 annual report: in 2022, the company achieved sales revenue of 2.341 billion yuan, yoy of 15.49%; net profit of 527 million yuan, yoy of 38.55%.
In the fourth quarter, the company achieved revenue of 522 million yuan, yoy of 14.73%, net profit of 64 million yuan, yoy of 3.23%.
Main points of investment:
Top-level design encourages the development and production of children's drugs. In January 2023, the Health Commission issued the Circular on further strengthening the Management of Clinical Drug use in Children, pointing out that the selection of drugs for children can be free from the restriction of "one product, two regulations" and the total number of drugs, and further broaden the scope of drug use for children.
Ikexin maintains a high growth rate, and there is still a lot of room for permeability. As of 2022, the penetration rate of Yikexin in people aged 0-1 years old is close to 30%. The penetration rate of people aged 1-6 years old is less than 5%. Overall, the permeability is only 7% at the age of 0-6 years old, and there is still much room for improvement.
The proportion of Yikexin hospital continues to decline, and the out-of-hospital market contributes the main profits. We believe that the decline in the proportion of hospital-end income makes the impact of collection on Ikexin limited and the policy risk further reduced.
The excess profit reward has not landed, and the core backbone incentive will not be affected. If the company does not land in the short term, the company can still stimulate the enthusiasm of the business backbone through other incentives within the authority of the company.
Profit forecast and investment rating: we expect the company's operating income from 2023 to 2024 to be 2.936 billion yuan, 3.575 billion yuan and 4.194 billion yuan, respectively, an increase of 25.40%, 21.79% and 17.32% over the same period last year. The net profit of homing was 689 million yuan, 866 million yuan and 1.068 billion yuan respectively, up 30.73%, 25.68% and 23.43% over the same period last year. In the long run, pink Ikexin is expected to contribute new growth momentum. Maintain a "buy" rating.
Risk hints: Ikexin sales are not as expected; business management is fluctuating; pharmaceutical policy risk; market competition is intensified; macroeconomic development is not as expected.