Main points of investment:
Maintain the "overweight" rating. We maintain the company's 2016-2017 EPS forecast of 0.15,0.21 yuan (2015 results have been announced), with reference to the comparable company valuation of 1.8x PB, we lowered the target price to 8.22yuan (- 3.94yuan) and maintained the "overweight" rating.
Proposed increase of 3.4 billion, comprehensive development of medicine: Yatai Group announced that it intends to add 731 million shares to no more than 10 specific targets, issue a base price of 4.7 yuan per share, and raise 3.435 billion yuan for the supporting facilities of the pharmaceutical industrial park, general medicine, health products, biological vaccines and other base construction, high-tech research and development, construction industrial products industrial park project and supplementary liquidity. We believe that this IPO indicates that the company will make a comprehensive effort in the pharmaceutical field, and the company will carry out international cooperative research and development based on the Pharmaceutical Industry Park to achieve breakthroughs in anti-cancer traditional Chinese medicine, biological vaccines, cardio-cerebrovascular and other projects. and create new profit growth points for health services and health products, and promote the transformation and upgrading of the pharmaceutical industry to a health industry. Speed up the chain expansion of retail pharmacies and establish a new business model of physical stores + network sales + free medicine delivery + wholesale.
Traditional business continues to "deleverage" and take industrial upgrading: we judge that traditional business sectors such as cement and coal may be further adjusted in the future, so as to realize the adjustment of the asset structure with high debt burden accumulated by traditional industries and develop into new businesses with light assets. We believe that with this fixed increase and industrial restructuring, sufficient cash is expected to achieve strong support for the transformation.
The proportion of state-owned assets was diluted, and the reform of local state-owned enterprises went further: the major shareholder, Changchun SASAC, did not participate in the subscription, and its shareholding dropped to 8.86%. The Jinta investment controlled by the company's executives promised to subscribe no more than 5% of the shares issued, and the reform of local state-owned enterprises went further.
Risk tips: macroeconomic risks, rising prices of raw materials.
