The concentration of the pharmaceutical business sector has increased rapidly driven by the policy, and the landing of the "two-vote system" in 2017 will promote regional leaders to have a stronger driving force for M & An integration and seize a larger share of the market replacement. Haiwang Bio seizes the good opportunity of industry integration to actively open up and expand its territory, quickly occupy the market through mergers and acquisitions in Shandong, Henan, Anhui, Heilongjiang and other regions, and is expected to become a regional circulation leader. At the same time, as a sunshine centralized distribution leader, the scale advantage has gradually emerged, the rapid growth trend of performance has been established, and it is expected to achieve rapid expansion in the next three years. Maintain the target price of 9.24 yuan and maintain the buy rating.
Support the main points of rating
As one of the earliest enterprises in the industry to enter Sunshine centralized distribution, after the increase of sales scale, the market development cost has decreased, the company's management and control ability has been enhanced, and the financial expenses have been reduced after the IPO last year, and the company has entered a period of rapid growth. The deduction of non-net profit in 2016 increased by 198% compared with the same period last year. The performance forecast for the first half of 2017 achieved a net profit of 2-250 million, an increase of 99.73%, 149.66% over the same period last year, and is expected to maintain rapid growth throughout the year.
The industry faces a historic opportunity for rapid integration. The formal promotion of the "two-vote system" will promote the arrival of the wave of pharmaceutical business mergers and acquisitions, and the concentration of the industry will increase rapidly. The pace of mergers and acquisitions is accelerated, and it is expected that the company's revenue and profits will be significantly thickened in the second half of the year, and the performance will grow by leaps and bounds. Book capital, corporate bonds, trust loans and ABS can provide sufficient ammunition for acquisitions.
GPO model is the future development trend in the field of medicine circulation. The promotion of the centralized procurement of Quan Pharmaceutical Network, a subsidiary of the Group, in Shenzhen will also give a positive impetus to the company's business, and other cities in Guangdong Province will also start GPO pilot projects one after another, which will promote the development of the company's centralized distribution business.
Main risks faced by rating
The risk that the speed of M & An is not as fast as expected; the risk of intensified market competition; the risk of related policy changes.
Valuation
The concentration of the circulation industry accelerated by the policy, the company's GPO business growth was steady, and active mergers and acquisitions accelerated performance growth. It is estimated that the 2017-2019 net profit is 7.52,9.93 and 1.17 billion yuan respectively, corresponding to 0.29,0.37 and 0.44 yuan per share respectively. Maintain the target price of 9.24 yuan, corresponding to the 17-year price-to-earnings ratio of 32 times, maintain the buy rating.