Events:
On April 26, 2017, the company released its quarterly report for 2017: during the reporting period, the company achieved operating income of 482 million yuan, an increase of 45.50% over the same period last year, and a net profit of 22.53 million yuan, down 28.54% from the same period last year.
Comments:
In 2017, the inventory clearance of Q1 company is gradually completed, and the company's performance can be reversed in the future:
In 2017, Q1's homing net profit decreased by 28.54% over the same period, mainly due to three major reasons: 1) the company has carried out marketing reform and channel inventory needs to be digested; 2) the competition in the field of OTC is becoming increasingly fierce, and sales of Banlangen and antiviral oral liquid have declined; 3) interest on short-term financing bonds has suddenly increased, resulting in a 382% increase in financial expenses compared with the same period last year. At present, the company's inventory clearance work has been gradually completed, and the sales model is expected to change from the dealer model to the company's terminal mode, which is good for the company to achieve a reversal in 2017.
The distribution of prepared pieces of traditional Chinese medicine is further expanded, and the industrial chain of traditional Chinese medicine resources continues to extend:
In the cultivation of traditional Chinese medicine, the company invests in the construction of Liupanshan Green traditional Chinese Medicine Industrial Park and Shangri-La Health Industrial Park, which are used to develop traditional Chinese medicine formula granules; in the field of traditional Chinese medicine preparation and circulation, the company strengthens its market position by acquiring the leading Tianji traditional Chinese medicine in Hubei Province. In the terminal channel, the company acquired a 60% stake in Zhaoyang Biology and made full use of its cold chain logistics distribution system to enhance the terminal control ability of the company.
Take the intelligent decoction center as a starting point to develop hospital terminals to enhance the sales and competitive advantage of prepared slices of traditional Chinese medicine:
The company actively promotes the construction of Hubei Tianji, Guangzhou headquarters and Bozhou Huzhu Wisdom decocting Center, builds Xiangxue Wisdom things Union traditional Chinese Medicine configuration Center, takes the boiling center as the breakthrough point to develop the hospital terminal, and comprehensively distributes "Internet + Internet of things + traditional Chinese Medicine". Enhance the sales and competitive advantage of Chinese medicine slices business.
Actively lay out accurate medical care to promote the development of pharmaceutical health strategy:
At present, the company focuses on developing new biological drugs for the treatment of tumors, viral infections and autoimmune diseases. In addition, Xiangxuekang Wanda, a holding subsidiary, has been granted a 90% stake in Yiluoqin to promote the company's clinical research in the field of cellular immunity with the help of its hospital channels and clinical base resources. The continuous layout of the company makes full preparations for the research and development of precision treatment technology in the future, which is conducive to the promotion of pharmaceutical health strategy.
Profit and Forecast:
According to the company's existing business situation, we estimate that the company's EPS in 17-19 will be 0.17,0.30,0.40 yuan respectively, corresponding to 67.5 PE 38.5 yuan 28.5 times. Considering the sustained high growth brought about by the change in sales model, we will give the company 70 times PE, corresponding to the target price of 11.90 yuan per share, compared with the closing price of 10.48 yuan per share on 2017-4-27, there is 14% room for increase, covering for the first time. Give a rating of "cautious recommendation".
Risk tips: marketing reform is not as expected; R & D failure risk; market competition intensifies.
