Key points of investment
Incident: The company achieved revenue of 10.49 billion yuan for the full year of 2022 (+18.5%, year-on-year growth rate in parentheses, same below); Guimu's net profit was 418 million yuan (+9.9%), after deducting non-net profit of 393 million yuan (+5.9%). The performance was in line with expectations.
It recovered quarterly in 2023, and profitability continued to strengthen: the company achieved revenue of 2,873 billion yuan (+28.8%) in a single quarter in Q4 and net profit of 146 million yuan (+91.0%). Q4 Q4 was due to the liberalization of the epidemic prevention and control policy, which led to short-term damage in hospital treatment volume, and the Q4 business was affected to a certain extent. We expect that as the peak of the epidemic passes in February, the company's business will continue to recover rapidly starting 2023Q2.
In terms of profitability, the company's gross margin increased quarterly. 2022Q4's gross margin reached 32.9%, +3.91pct year on year, +5.14pct month-on-month. As business resumed, gross margin continued to recover.
Various business pipelines recovered at an accelerated pace, and the recovery trend strengthened in 2023: by business, the company's 2022 commercial revenue was 10.0.0 billion yuan (+12.3%), of which 1) the intensive business/regional inspection center business achieved revenue of 2.67 billion yuan (+ 6.0%), and the number of intensive customers reached 420 (+7.4%). With the easing of the epidemic in the second half of the year, the growth rate of intensive business reached 10.7%, 2) Third-party laboratory business revenue of 1.35 billion yuan (+283%); industrial revenue of 485 million yuan (-3.4%), company-related Business entities are mainly located in Shanghai and East China. The epidemic prevention and control in the first half of the year had a great impact on industrial business. As the impact of the pandemic on the company's business is eliminated, the company's 2023 performance is expected to accelerate further.
R&D pipelines continue to be implemented, and an industrial pipeline matrix is formed: the company invested 146 million yuan (+18.7%) in R&D in 2022, launched a new generation of glycated hemoglobin analyzer MQ-8000, and also launched an overall clinical mass spectrometry solution, developed unique patented technology “Spectrum Easy Fast” liquid extraction column and “Spectrofanda” fully automatic processing system, etc., and relied on its own new product R&D center to continuously improve the overall level of research and development. While continuing to develop new products, it upgraded the original product technology, achieved great results, and established good results in the market Word of mouth.
Profit forecast and investment rating: Considering the impact of the epidemic in the first quarter, we adjusted the net profit of 2023-2024 from 57/71 million yuan to 52/63 million yuan. The estimated net profit of 2025 was 790 million yuan, and the P/E valuation for 2023-2025 was 15/12/10 times respectively; based on the expansion of the company's commercial sector intensive model, deep binding to Sinopharm, various pipelines in the industrial sector; maintaining the “buy” rating.
Risk warning: policy risks such as DRG/DIP; promotion of intensive models falls short of expectations; promotion of industrial lines falls short of expectations; uncertainty about Chinese pharmaceutical cooperation, etc.