Focus on the middle and high-end medical market, business expansion to obstetrics and gynaecology. The company is a leading private paediatrics service provider in Beijing, operating three medical institutions under the brand "New Century Medical". According to Frost Sullivan, in terms of market share in 2015, the company's three medical institutions ranked first in Beijing's private pediatric market and the middle and high-end pediatric market, with a market share of 30.4% and 36.5%, respectively. and ranked second in China's middle and high-end private paediatric market, with a market share of 11.4%. In November 2015, the company acquired Beijing New Century Women's and Children's Hospital and expanded its business to obstetrics and gynaecology services, enriching service content, enhancing customer loyalty and expanding its revenue base.
Expand the territory through mergers and acquisitions. The company's earnings in 2013, 2014 and 2015 were RMB 238.8 million, RMB 249.0 million and RMB 258.2 million, respectively. The gross profit for the same period was RMB 149.8 million, RMB 143.9 million and RMB 140.5 million respectively. The decrease in the Group's gross profit margin during the track record period was mainly due to the increase in employee welfare expenditure and the low profit margin of the Beijing New Century Women's and Children's Hospital it acquired.
Pediatrics gynecology and obstetrics coexist, and the business complement each other. The company's medical services are composed of two main parts, including paediatrics services and obstetrics and gynaecology services, which complement each other: Beijing New Century Children's Hospital provides a wide range of pediatric services, specializing in dealing with most complex pediatric diseases; Beijing New Century Women's and Children's Hospital not only provides comprehensive obstetrics and gynaecology services, but also provides a small amount of pediatric services, which can deal with obstetrical and pediatric diseases and more complex pediatric diseases. Beijing New Century Ronghe outpatient Department provides general specialist paediatric services and some gynecological services. In terms of professional services, patients can be transferred to Beijing New Century Children's Hospital for paediatric services and Beijing New Century Women's and Children's Hospital for obstetrics and gynaecology services. The internal patient referral mechanism can effectively improve the utilization rate of different specialist scope and strength among the medical institutions of the group. In addition, the company enjoys a high reputation and a leading position in the Beijing pediatric service market, which helps to attract new obstetrics and gynaecology patients, and obstetrics and gynecology services can also bring new patients to pediatric services.
It is recommended to subscribe carefully. The company is one of the few private hospitals in Beijing that can provide general practice for children, complex diseases and leading clinical experience and medical concepts. As health care in the new century focuses on the middle and high end of the medical market, based on the fact that the consumption power of Beijing's population is higher than that of other second-and third-tier cities, coupled with the full opening of the second-child policy, the rise in fertility will boost the demand of high-income people for high-quality "one-stop" obstetrical and paediatric services. In terms of valuation, the company has a price-to-earnings ratio of 66.6-87.6 times and a price-to-book ratio of 5.4-5.9 times in 2015, which is higher than that of its peers, but has great potential for medium-and long-term development. It is recommended to subscribe carefully.
