经营端：门店稳健扩张，利润率稳步提高，成本有望随规模效应突显而摊薄。1）瑞泰品牌对应中端口腔医疗市场，近1-2 个财年扩张速度明显提升；2）不同品牌机构毛利润率随店龄增长而提升，公司医院+诊所协同扩张模式更易于获客与提升品牌力，进而促进毛利润率提升；3）随着公司规模效应突显，成本有望摊薄，实现净利润贡献。Summary of the report:
The oral medical service industry has broad room for growth, and under the logic of the strong, the head organization is expected to seize more market share. 1) according to our estimation, the oral medical service market still has 4 times growth space in the long term, and there is still a prosperous market pattern of supply and demand in the long-term period of planting and orthodontics. 2) the density of medical institutions is still at a low level compared with Japan. It is expected to achieve multiple growth in the long term. 3) the pattern of private market as the main body is becoming more and more stable, which is beneficial to the head private chain medical institutions.
Doctor resources are the core strategic resources of dental chain medical institutions. Riel Group has rich and senior doctor resources, and the retention rate of core doctors is high. 1) according to the annual report for fiscal year 2023, more than 46.4% of the company's full-time dentists have master's degrees or above, and many dentists hold titles and qualifications such as attending physicians or medical discipline leaders. Dentists who have been employed with the company for more than five, ten and fifteen years account for 37.2%, 13.9% and 6.1% of the company's total dentists. 2) according to the company's mid-fiscal year 2022 report, the company has 882 full-time dentists. among them, the retention rate of three years or less work experience is 77.6%, and the retention rate of three years or more work experience is 95.8%, which shows a higher retention rate of core staff. 3) the company has established a perfect mechanism in obtaining medical treatment, education and hospitalization, and has obvious long-term competitive advantage.
Operating end: the stores expand steadily, the profit margin increases steadily, and the cost is expected to be diluted with economies of scale. 1) Ruitai brand, corresponding to the mid-range oral health care market, has significantly increased its expansion rate in the past 1-2 fiscal years; 2) the gross profit margins of different brands increase with the age of the store, and the company's hospital + clinic collaborative expansion model is easier to win customers and enhance the brand strength. 3) with the company's scale effect highlighted, costs are expected to be diluted to achieve net profit contribution.
Patient side: the dual-brand strategy accurately distinguishes the patient group, the patient loyalty is high, and the ability to maintain customer relationship is higher than the average level of the industry. 1) the dual-brand strategy accurately locates the target patient group, which is easier to maintain the customer relationship and build the brand, and helps the company to succeed in the market segment competition in the long run; 2) the company has made outstanding achievements in customer relationship maintenance. the re-visit rate of loyal customers is high, and the proportion of old patients recommending new patients is on the rise.
Profit forecast: the company is a leading enterprise in domestic high-end oral medical services, and the proportion of mature stores continues to improve under the dual-brand strategy. in the future, we predict that the company's return net profit from 2024 to 2026 will be 0.18pm 0.21pm 0.15 million yuan respectively, EPS 0.03pm 0.21max 0.37RMB, the current market capitalization corresponding to PE 230x / 35x / 20x, respectively, given the "overweight" rating.
Risk hints: lower-than-expected store expansion risk, core doctor loss risk, policy risk
