Summary of the report
Jilin Aodong is a listed company with the rapid development of multi-wheel drive mode of "Medicine + Finance + Great Health". It has been ranked among the top 100 of China's pharmaceutical industry and "the most valuable brand of China's 500" for more than ten years.
The company's proprietary Chinese medicine business, chemical medicine business, big health business and other sectors of the steady growth, to promote the company's sustained and coordinated development.
Main points of investment
The company has an excellent brand of Anshen Busunao liquid, and its sales volume is growing steadily.
The company's sales of Anshen Bunao liquid have maintained steady growth for more than 40 years since it was listed in 1983, and the market has formed a good reputation and brand effect. In 2022, Anshen Bunao liquid has developed into a core variety with an annual sales income of more than 600 million yuan, an increase of 9.43% over the same period last year. Due to the characteristics of the Anshen Bunao market and the company's excellent brand power, we believe that this variety has the potential to maintain sales growth.
Xiaoer Chaigui antipyretic oral liquid has great potential, and it is expected to continue to release the company's Xiaoer Chaigui antipyretic oral liquid as a national exclusive patented product, over-the-counter medical insurance. Relying on the advantages of high cure rate, low recurrence rate, short treatment cycle, stable and non-rebound fever, it has quickly become a first-line drug for pediatric respiratory diseases and won the title of high-quality brand trusted by 3.15 healthy Chinese consumers.
From 2020 to 2022, the average annual compound growth rate of Xiaoer Chaigui antipyretic oral liquid was 73.34%. The sales volume in 2022 was 162 million, which was 53.73% higher than the same period last year. Considering the shortage of pediatric drug market and the policy encouragement of pediatric drugs, we believe that this variety is expected to maintain good growth prospects.
Participate in GF Securities Co., LTD., continue to benefit from steady investment
GF Securities Co., LTD. is the core quality asset of the company. the company began to invest in GF Securities Co., LTD. in 1999 and became GF Securities Co., LTD. 's largest shareholder in 2016. As of June 30, 2023, the total share capital of GF Securities Co., LTD. held by the company and its wholly-owned subsidiaries was 19.72%. GF Securities Co., LTD. provided a stable investment income for the company, which was 1.778 billion yuan, 1.958 billion yuan and 1.448 billion yuan respectively from 2020 to 2022.
Profit forecast and valuation
We estimate that the total revenue of the company from 2023 to 2025 is 34.49 trillion yuan, up 20.26%, 17.31% and 15.91%, respectively, and the net profit attributable to shareholders of the listed company is 20.182.54 trillion, and the EPS is 1.73, 1.94 and 2.29 yuan, respectively. Considering that the company is a well-known brand OTC enterprise, the growth of proprietary Chinese medicine business is steady, and the continuous expansion of chemical medicine and big health business brings good growth, we are optimistic about the future development of the company's pharmaceutical business; at the same time, the company obtains sound investment income every year through equity investment, and the overall fundamentals are excellent. Coverage for the first time, given a "buy" rating, with a target price of 22.67 yuan per share.
Risk hints: pharmaceutical industry policy risk, raw material price fluctuation risk, environmental protection risk, drug research and development risk, investment risk, fund-raising project risk, subjective risk.