Event: recently, Liedman released the 2015 annual report, during the reporting period, the company achieved operating income of 682 million yuan, an increase of 26.95% over the same period last year. The net profit belonging to shareholders of listed companies was 157 million yuan, up 22.56% from the same period last year (net profit after deducting non-profit increased by 19.96% over the same period last year), EPS0.37 yuan. At the same time, the company intends to distribute a cash dividend of 0.6 yuan (including tax) to all shareholders for every 10 shares. In addition, the company released a forecast of results for the first quarter of 2016, which is expected to achieve a 5% year-on-year increase in net profit.

Comments: the income and net profit of the parent company were 410 million yuan and 107 million yuan respectively, down 12.33% and 12.82% respectively from the same period last year. Desai's combined table contributed 48.77 million yuan in net profit. On a quarterly basis, the parent company's Q4 revenue and net profit fell 7.46% and 14.53% respectively compared with the same period last year, and the pressure on inventory at the end of 14 years is gradually eliminating. In terms of business, the sales of reagents were 573 million yuan, an increase of 19.23% over the same period last year, and the income contributed by Chinese medicine channels was 162 million yuan. The sales of the instruments totaled 85.65 million yuan, a sharp increase of 127.89 percent over the same period last year. In addition, the income of biochemical raw materials was 12.87 million yuan, down 12.37% from the same period last year. Looking forward to 2016, we believe that the equipment launch of the parent company is smooth, which is expected to lead to a resumption of reagent growth. at the same time, taking into account the new consolidation effect of Desai in the first half of 16 years, we expect the company's apparent performance growth in the past 16 years to maintain steady and rapid growth.

Profit forecast: overall, we believe that despite the pressure on the company's endogenous growth in the past 15 years, inventory digestion performed well at the end of the year. The company has still achieved steady and rapid growth in apparent performance through active foreign cooperation, mergers and acquisitions and marketing system reform. In the future, with the continuous volume of the company's new products (IDS, Enigma, chemiluminescence, etc.) and the continuation of epitaxial development, its growth rate is expected to further increase. We estimate that the EPS of the company from 2016 to 2018 will be 0.44,0.51,0.60 yuan respectively, and the corresponding valuation will be 34,29 and 25 times respectively, and the company will continue to maintain its "overweight" rating.

Risk hint: the scale of the company's accounts receivable is larger, mergers and acquisitions or new business development is lower than expected.