Core views:
The operating data for the first half of the year is impressive. The company released its 2023 mid-year report results, achieving revenue of 225 million yuan (YOY +88.51%), net profit of 212 million yuan (YOY -130.54%), net profit of non-attributable net profit of 188 million yuan (YOY -101.68%), gross profit margin of 76.9% (YOY+6.9pp). The increase in revenue is due to accelerated commercialization of Tavr products TaurusOne and Tauroneus; Neural intervention products continue to be released, including Tethys, SacSpeed, Jasper, Products such as Syphinet and the ischemic product Fastunnel contribute to revenue.
Valve products under development continue to gain strength. As an active valve product, third-generation TaurusNXT is undergoing multi-center registration clinical trials; fourth-generation TaurusApex is doing animal experiments and follow-up work; the TaurusWave shockwave system is conducting scientific experiments; Trilogy completed 2 commercial implantations in Hong Kong in May 23 and initiated a multi-center registered clinical trial. The first patient was enrolled in July of the same year. Mitral valve products, HighLife, and GeminiOne are all undergoing multi-center registered clinical trials. As a tricuspid valve product, MonarQ has completed 2 implant surgeries in Europe and plans to conduct early feasibility studies in the US.
A number of new Jinsuke products will be released soon. Among bleeding products, the NRCoil detachable spring ring was approved in August 23; the company is developing the second generation Jasper based on clinical feedback to optimize product performance.
Among ischemic products, both SACspeed and Fastunnel are preparing to develop second-generation products based on clinical feedback; NeuroStella intracranial stent products have been registered and enrolled in clinical trials.
Profit forecasts and investment recommendations. The estimated total revenue for 23-25 is 447 million yuan, 666 million yuan, and 941 million yuan, respectively, and the corresponding EPS is -0.70 yuan/share, -0.19 yuan/share, and 0.01 yuan/share. Taking into account the company's industry position and business growth, the company was given a 23-year PS of 20X, corresponding to a reasonable value of HK$12.11 per share, maintaining a “buy” rating.
Risk warning: Products under development are expensive, product sales fall short of expectations, and low acceptance among operators.