The results of 2013Q4 and 2014Q1 are in line with expectations: after the completion of major asset restructuring, 2013Q4 achieved revenue of 929 million yuan, an increase of 88.40%; net profit of 113 million yuan, an increase of 51.17%, deducting non-attributable net profit of 88 million yuan, an increase of 604.43% over the same period last year, equivalent to 0.29 yuan of EPS. The 2014Q1 income was 253 million yuan, up 146.12%, and the non-attributable net profit was 29 million yuan, an increase of 105.84%, equivalent to 0.06 yuan in EPS. The performance is in line with the previous performance KuaiBao and our expectations. With the deepening of integration, the overall synergy will get better.
The three major subsidiaries are running on the fast lane, and there will be good news in the future: we speculate that Jinqiao Pharmaceutical, Magic Pharmaceutical and Baiqiang Pharmaceutical will grow by 40% +, 25% + and 35% respectively in 2013, of which sodium cantharidate and VB6 will grow by 37% + and 50% respectively. Jinwu Gutong, Jingwu capsule and Yindanxintai increased by 30% and 20% respectively, and the company is on the road of rapid growth.
The launch, extension and integration of new varieties in 2014 are the booster of the company's rapid growth: the launch of new varieties such as sodium cantharidate tablets, Yining syrup and Eucommia ulmoides Shuangjiang tea in 2014 will bring new growth points. Guizhou is rich in pharmaceutical mergers and acquisitions, looking forward to the company's action in extension. More importantly, in-depth integration, sales coordination, management improvement, is the cornerstone of the company's rapid and sound development.
Investment suggestion: we are strongly optimistic about the future growth space of the company's anti-tumor varieties, excellent and rich product echelon, with the integration of in-depth synergy, business conditions will gradually improve, maintain 2014-15 EPS0.53, 0.71 yuan, maintain the buy-An investment rating, maintain the 12-month target price of 21.60 yuan.
Risk hint: internal integration may take a long time and difficult; about 45 million shares were lifted in July 2014.
