The company has a rich variety of products and pays attention to foreign markets: the company has been deeply cultivated in the medical device industry for many years, and its products cover many categories, such as blood oxygen, ECG, ultrasound, monitoring, blood pressure and so on. It can be widely used in hospitals at all levels, outpatient departments, community health service centers, village clinics, physical examination centers, pension institutions, family individuals, enterprises and institutions and other occasions. From 2017 to 2019, the combined income of blood oxygen, monitoring and ECG accounted for 75.35%, 72.16% and 73.57% of the main business income respectively; the product structure was relatively stable.
COVID-19 's performance increased significantly in the first half of the epidemic: since the COVID-19 epidemic, due to the need for epidemic prevention, control and treatment, the demand for infrared thermometers, blood oxygen and other products from issuers has soared, resulting in a sharp increase in performance. In the first half of the year, the company realized operating income of about 750 million yuan, an increase of about 421% over the same period last year, and a net profit of 364 million yuan, an increase of 1820% over the same period last year. The company estimates that the annual revenue is 1.25 billion yuan, an increase of 222.8% over the same period last year, and the net profit returned to the mother is 547 million yuan, an increase of 642.0% over the same period last year.
The proportion of overseas sales is higher: individuals and families in Europe and the United States and other developed countries pay more attention to their own health, and health management is also more elaborate, so there is a strong demand for rehabilitation self-examination and preventive products such as blood oxygen meters, sphygmomanometers and fetal heart meters; while the medical level in India and other developing countries is constantly improving, and there is a strong demand for products used in the treatment process, such as monitors. This makes the proportion of overseas sales of the company higher. From 2017 to 2019, the proportion of export sales of the company was 66.71%, 76.35% and 71.94% respectively.
Attach importance to the research and development of independent intellectual property technology and products: the company has mastered many core technologies, such as pulse oximeter, ECG acquisition technology, ECG automatic analysis algorithm, etc. As of December 31, 2019, the company has obtained 160 domestic patents (including 36 invention patents), 4 foreign patents, 110 software copyright, 66 utility model patents and 58 design patents. In 2019, the company invested about 40.5675 million yuan in R & D, accounting for about 10.48% of the company's revenue.
Comparison with comparable companies: the company's capital accumulation during the epidemic and its rich variety of products, relatively perfect sales system, or contribute to the future development of Kangtai medicine. The growth rate of operating income and return net profit of Kangtai Medical Company declined in 2017 and 2018, mainly due to the fluctuation of health all-in-one machine income and ECG machine income, and returned to positive growth in 2019. The performance of the company in the first half of 2020 is much better than the average of comparable companies. In 2019, Kangtai Medical achieved a revenue of 387 million yuan and a net profit of 74 million yuan, which is comparable to the average PE (2019) of the company about 69.97X.
Risk hints: trade friction risk, technical dispute risk, dealer management risk, industrial policy change risk, business fluctuation risk caused by COVID-19 epidemic.