The company announced its results for the first quarter of 2015, with revenue of 525 million yuan, an increase of 0.20% over the same period last year; net profit of 587 million yuan, an increase of 154.16% over the same period last year; and net profit of 569 million yuan, an increase of 137.44% per share, an increase of 153.85%.
The bull market has greatly increased the performance of GF Securities Co., LTD., who participated in the company, and the company's investment income in joint ventures and joint ventures reached 518 million yuan, a sharp increase of 195.87 percent over the same period last year.
The company's main business basically remained stable, with revenue basically the same as last year, with a gross profit margin of 63.91%, down about 6 percentage points from the same period last year; sales expenses rate of 39.83%, down nearly 3 percentage points from the same period last year; and management expenses of 8.91%, up about 1 percentage point from the same period last year.
The company's pharmaceutical products adhere to the "large variety group, multi-variety group" development strategy, the key products include "Anshen Bunao liquid", "Xuefu Zhuyu Oral liquid", "II for injection", "calf spleen extract injection", these products have great sales potential, but in the current bidding environment, sales growth may slow down. The company's second-line products include "Linaoxin capsule", "Lutai granule", "Yuxintong capsule", "Shenjin tablet", "Xinnao Shutong capsule", "Yangxue Yin Oral liquid" and other varieties, and its sales are expected to increase gradually in the future. to make up for the slowdown in the growth of the main products. The company's new varieties such as "Shenze Shugan capsule" and "Xiaoer Qi Hawthorn Oral liquid" are sold by subsidiaries on the Internet, and are expected to form new sales channels in the future.
In the aspect of new products of proprietary Chinese medicine, compound Banlangen oral liquid and Qihuangyishen oral liquid are expected to be produced and sold, and new drugs such as honeysuckle buccal tablets, honeysuckle pharyngitis granules, Chaihuang soft capsules and Shuyuwei Kexin capsules are expected to be introduced. New chemical products including a class of new antineoplastic drugs, boanmycin hydrochloride for injection and pingyangmycin hydrochloride for injection are expected to start production and sale. Adenosine succinosylate methionine for injection and reduced glutathione for injection have great potential.
Investment advice: benefiting from the bull market environment, GF Securities Co., LTD. 's investment income will be greatly increased. We predict that the company's EPS in 2015 and 2016 will be 2.32 yuan and 2.6 yuan respectively, and the current stock price is 16.6 times and 14.8 times PE respectively. Maintain the overweight rating.
Risk hint: GF Securities Co., LTD. 's performance fluctuates, medical policy changes, and foreign investment fails.