Investment Summary:

1. At present, the company is the only listed company that can provide the integration of preclinical, clinical services and registration application of traditional Chinese medicine; benefiting from the "Special regulations on Registration and Management of traditional Chinese Medicine", the clinical service market of traditional Chinese medicine has ushered in a broad space of increment. The company's clinical service business of traditional Chinese medicine is expected to grow at a high speed. two。 As the clinical trial returns to normal, the backlog of orders will quickly turn into revenue, helping the company to further improve its performance.

The whole process of "one-stop" service, the coordinated development of all major businesses

The company's business scope has expanded from the early provision of limited preclinical research and some clinical research services to all aspects of the new drug research and development chain.

One-stop service enables the company to more accurately grasp the dynamics of the industry, improve the success rate of new drug research and development, meet the multi-level business needs of customers, and achieve the continuity and stability of service provision.

Policy helps to open up a broad space for the clinical service market of traditional Chinese medicine

Eligible classic prescriptions apply for listing and are exempted from pharmacodynamic research and clinical trial data. the overall clinical scale is expected to reach 2.568 billion yuan.

The standardized human experience data of hospital preparations can replace the phase II clinical study, and the market space for clinical services of traditional Chinese medicine is about 2.678 billion yuan.

The revision of the listed instructions of traditional Chinese medicine has reached a critical moment when it must be done. A market space of 2.655 billion yuan may be created in 3 years.

Multi-dimensional technical barriers

The company has established a solid moat in terms of core technical personnel, traditional Chinese medicine expert resources, standardized process system, brand and reputation.

Traditional Chinese medicine research and development environment improvement superimposed recovery expectations, performance increment is expected to restart high growth is expected to restart revenue of 5.868.49 / 1.252 billion yuan in 2023-2025, an increase of 38.34% / 44.83% / 47.5% over the same period last year.

Investment advice:

The net profit of the company from 2023 to 2025 is 0.380.6 / 94 million yuan, corresponding to 0.10.16 / 0.25yuan per share. The company's target price in 2023 is 12.36 yuan, giving a "buy" rating for the first time.

Risk hints: policy risk; contract execution risk; test delay risk; inter-industry competition risk