Matters
In the first half of 2015, the company achieved operating income of 456 million yuan, an increase of 33.69% over the same period last year; net profit returned to its mother was 55.19 million yuan, up 13.04% from the same period last year, or 0.17 yuan per share; and the company expects net profit from January to September to increase by 20% from January to September compared with the same period last year.
Main viewpoints
1. In the first half of the year, the income of the main pharmaceutical industry declined due to the impact of bidding, and the ginseng business plate became a new bright spot. The revenue in the second quarter was 275 million yuan (an increase of 62.72% over the same period last year), and the net profit was 42 million yuan (an increase of 28.13% over the same period last year). Revenue from the pharmaceutical sector fell 3.01% in the first half of the year, while the leading products Zhenyuan capsule (up 14.02%) and Xinyue capsule (up 30.26%) maintained a good growth trend in the first half of the year. The main injection varieties Shengmai injection (down 5.97%) and Qingkailing injection (down 43.39%) decreased significantly due to the postponement of bidding and the control of "medicine proportion". With the promotion of bidding, the material will be improved in the second half of the year. The pharmaceutical sector is expected to maintain steady growth throughout the year. Ginseng processing plate has become a new profit growth point for the company in the first half of the year, with sales revenue of 93.6386 million yuan (up 43.91% year on year) and net profit of 18.3701 million yuan, accounting for 33.27% of the company's net profit. At the end of June, the company signed a "product purchase and sales contract" for the sale of ginseng slices with Liaoning Tianshili Sentao ginseng antler Co., Ltd., with a total contract of 105.8 million yuan (accounting for 13.43% of the company's 2014 operating income). It is expected that new orders will be confirmed in the second half of the year, and ginseng business will continue to contribute to the performance throughout the year.
two。 The land problem is solved and the construction of industrial parks is expected to speed up. On June 20, the land problem that has plagued the company for three years was solved, and the construction of Ginseng Industrial Park is expected to start in late August, planning 200 mu of ginseng slices project and 200 mu of cosmetics / bees project. We expect the ginseng slices project to be completed in September 2016, which includes three businesses-molded red ginseng, ginseng finishing (ginseng ointment, ginseng oral liquid, ginseng dripping pills, etc.) and characteristic Chinese herbal slices (ginseng, Schisandra and other small packaging Chinese herbal slices). The start-up of the ginseng prepared slices base will lay the foundation for the extension of the company's ginseng industry chain.
3. The cosmetics business is rapidly promoted through franchise, and annual sales are expected to exceed 100 million. China and South Korea Yisheng Hanshen Cosmetics Co., Ltd., which was established three months ago, achieved a sales income of 31.9636 million yuan in the first half of the year. Due to the high expenses in the early stage of business development, the net profit was-1.53 million yuan. Relying on the technical team of South Korea and the sales team with rich sales experience and channels in China, the company focuses on the beauty salon market through franchise. at present, it has completed nearly 1000 beauty salons, and plans to complete the layout of 2000 next year. The company has four cosmetics brands: Lanyere, luxury lotus, Eshenio, Feluiere, the products cover moisturizing, anti-aging, whitening, soothing, anti-acne, sunscreen, makeup and other basic skin care series, the new model is expected to bring a rapid increase in sales revenue, which is expected to exceed 100 million this year.
4. Investment advice: "recommended". The company has four major business units (drugs, ginseng slices, cosmetics and bee products), which has realized the transformation and upgrading from "troika" to "four-wheel drive". Ginseng and cosmetics have become new profit contributors. The company's performance fell by 20% in the first quarter and rebounded by 28% year-on-year after the second quarter, and gradual improvement is expected to continue. Considering the higher-than-expected promotion of cosmetics and the huge profit potential of ginseng slices, it is recommended to actively participate in bargain hunting. It is estimated that the net profit from 2015 to 2017 is 1.32,1.80 and 234 million yuan, and the EPS is 0.40,0.54,0.71 yuan. At present, the stock price corresponds to PE as 47X/35X/27X.
Risk hint
1. The promotion of ginseng slices and cosmetics projects is lower than the expected risk.
two。 Raw material price fluctuation and ginseng planting risk.