The company announced that it plans to buy 51% of the shares of Beijing Anders Kopp Trading Co., Ltd., an intervertebral hole mirror equipment and matching equipment consumables company for 93.71 million yuan. After the acquisition, Anders Kopp will become a controlling subsidiary of the company. Combined with the trend of minimally invasive clinical spinal surgery, this acquisition will further accelerate the overall layout of the company's spinal product line. To maintain the company's 2021-2023 EPS forecast of 1.95 Universe 2.490.14 yuan, corresponding to the PE 38-30-24 times, maintain the "buy" rating.
It is proposed to acquire a 51% stake in Anders Kopp to improve the layout of the minimally invasive production line of the spine. In order to further speed up the overall layout of the company's spinal product line, combined with the trend of minimally invasive clinical spinal surgery, the company plans to invest 93.71 million yuan to acquire a 51% stake in Beijing Anders Kopp Trading Co., Ltd., an intervertebral foramen mirror equipment and ancillary equipment consumables company. After the completion of this acquisition, Anders Kopp will become the company's holding subsidiary. Anders Kopp's main products are foraminoscope equipment and matching instrument consumables, and it has the exclusive agency in China for all products such as spinal endoscopic surgical instruments made by (SPINENDOSGmbH), Germany. 2021Q1 Anders Kopp has a business income of 8.1912 million yuan and a net profit of 3.4057 million yuan. This acquisition is expected to further improve Dabo Medical's spinal production line, and achieve coordination in R & D, sales and other dimensions, which is expected to comprehensively enhance the comprehensive competitiveness of the company's spinal production line.
A new round of equity incentive scheme shows confidence in growth. The evaluation index of the company's last equity incentive plan was based on the deduction of non-net profit in 2018, and the deduction growth from 2019 to 2021 was not less than 24%, 55%, 95% (year-on-year growth of 24%, 25%, 26%), and the incentive effect was obvious in the performance in 2018 and 2020.
Recently, the company has announced a new equity incentive plan, with a price of 26.08 yuan per share for the first time. The assessment index is that the growth rate of deducted non-profit in 2022-2024 is not less than 24%, 55%, 95% over 2021 (24%, 25%, 26%, compared with the same period last year). With May 14, 2021 as the award date, the company has awarded 3.1094 million restricted shares to 540 incentive targets for the first time, covering the company's directors, core management and technical personnel, and the scope of incentive has been further expanded compared with the previous round. And the performance target nearly doubled in three years, demonstrating management's confidence in the rapid growth of performance.
Based on orthopaedics, actively layout and innovate the production line of consumables. The company is a leading brand in the field of trauma and spine made in China. In 2020, the operating income of trauma products of the company was 981 million yuan, an increase of 23.06% over the same period last year, with a gross profit margin of 87.72% (+ 0.18Pcts). The leading edge was further consolidated; the revenue of spinal products was 369 million, an increase of 39.31% over the same period last year, and gross profit margin was 89.76% (+ 0.44Pcts), which has gradually become a new growth engine. The revenue of minimally invasive surgical products was 111 million yuan, an increase of 21.69% over the same period last year, and that of neurosurgical products was 38.129 million yuan, an increase of 10.64% over the same period last year. The company continues to consolidate its advantages in the field of trauma and spine, and continues to deepen its layout in the fields of joint, minimally invasive surgery and dentistry, with broad prospects for long-term development.
Risk factors: acquisition project progress is not as expected risk; collection and bidding price reduction risk; distribution model risk; raw material supply risk.
Investment suggestion: the company is a leader in orthopedic high-value consumables in China, and takes the lead in the fields of minimally invasive surgery and dentistry. The acquisition of Anders Kopp will further expand the company's competitive advantage in the spinal production line and benefit the long-term development. The EPS forecast of the maintenance company from 2021 to 2023 is 1.95 pound 2.49 million 3.14 yuan, corresponding to PE38/30/24 times. Give the company 43 times PE, in 2021 corresponding to the target price of 83.85 yuan, maintaining the "buy" rating.