Event: 2023H1 income was 1.194 billion yuan, up 19.96% over the same period last year; net profit was 380 million yuan, up 25.30%; non-net profit was 367 million yuan, up 26.3% over the same period last year. 23Q2 achieved a revenue of 478 million yuan in a single quarter, down 0.07% from the same period last year, a net profit of 210 million yuan, an increase of 15.01% over the same period last year, and a non-net profit of 203 million yuan, an increase of 15.48% over the same period last year.

The performance of the main business is outstanding, and marketing planning contributes to the growth. 2023H1's operating income was 1.194 billion yuan, an increase of 19.96% over the same period last year, of which the main business income was 1.187 billion yuan, an increase of 19.67% over 992 million yuan in the same period last year. Marketing strategies contribute to the growth of the main business, including: promoting the "value marketing" strategy; perfecting the medical promotion model represented by Gejie Dingchuan capsule; formulating special incentive policies for key first-and second-tier varieties; optimizing and adjusting the sales policy of Sanjin granules; reshaping the circulation rules of Sanjin tablets and the price system of watermelon cream products; continuously improving the academic system of quality regulations in hospitals such as Vertigo Ning and Naomaitai; and opening up terminal sales growth points. Promote the brand rejuvenation strategy and so on.

Focus on R & D and innovation of traditional Chinese medicine, rich in products under research. The company deeply ploughs the field of traditional Chinese medicine, makes fine fist products, adheres to the research of classical prescriptions, prescriptions of the same name, and new drugs of traditional Chinese medicine, has obtained 6 invention patents, and its core competitiveness has been continuously improved; Sun Company has a total of 12 treasure ship biology research projects, of which 7 clinical trials are under way.

Sun Company reduces fees and increases efficiency, and Shanghai Sanjin is expected to break even. Sun company treasure ship biological prudent implementation of organizational restructuring, adjust the R & D pipeline, reduce management costs, make full use of existing production capacity; Baifan Bio has nearly 300 million CDMO orders, but the digestion cycle is long. The company is optimistic about reducing losses and aims to break even by the end of the year.

Profit forecast and valuation suggestion: the company's revenue from 2023 to 2025 is expected to be 2.67 billion yuan, respectively, and the net profit of returning home is 4.8 billion yuan, 67.1 billion yuan, respectively, maintaining the "buy" rating.

Risk hint: the risk that product sales are not as expected, the risk of intensified competition in the industry, and the risk that R & D progress is not as expected.