Brief comment on performance
On October 27, 2023, the company released three quarterly reports, showing that 1~3Q23 revenue, net profit from home and non-return were 1975.08 yuan, 37.97 yuan and 3.304 billion yuan respectively, an increase of 13.11%,-21.13% and-10.64% respectively over the same period last year. These three items were 649.16 yuan, 11.87 yuan and 1.105 billion yuan, respectively, an increase of 3.2%, 6.14% and 8.66% over the same period last year. The performance is in line with expectations.
Business analysis
Excluding the impact of one-time special profit and loss, the company's return net profit increased by 8.57% compared with the same period last year.
(1) due to the influence of Qingchunbao relocation income in the same period last year and the provision for asset impairment of Shangyao Kangxinuo, the company's net profit in the first three quarters was 3.797 billion yuan, excluding one-time profits and losses, an increase of 8.57 percent over the same period last year. (2) in the first three quarters, the industrial contribution profit was 1.813 billion (+ 9.72%), the commercial contribution profit was 2.626 billion (+ 8.8%), and the profit contributed by the participating enterprises was 461 million (- 3.54%) after excluding the influence of CANSINOBIO.
Three new drug pipelines were added in a single season to continuously promote large varieties of traditional Chinese medicine. (1) in the third quarter, the company added 3 new drug pipelines, including 2 innovative drugs, including oral microecological living bacteria preparation WST04 for the treatment of advanced malignant solid tumors, and new drug clinical (IND) applications were accepted in September; immunomodulator I035 was intended to inhibit intestinal inflammation and enhance intestinal immune regulation, and IND applications were accepted in September. Two new varieties of consistency evaluation were added. (2) by the end of the third quarter, the company has submitted applications for listing of three new drugs: I001 tablets, X842 and B019, and the cumulative number of products approved for consistency evaluation has increased to 55 varieties. (3) the evidence-based medicine research of six varieties of traditional Chinese medicine Yangxinshi tablet, Yuxuebi capsule, Guanxinning tablet, Babaodan, Weifuchun and ginkgo ketone ester continued to advance, and the number of cases in the group further increased. Among them, the revenue of traditional Chinese medicine in the first three quarters increased by 16.51% over the same period last year.
To create a new drug service platform, Shangyun Health completed 500 million C round of financing. (1) the company upgrades the pharmaceutical circulation supply chain to provide global pharmaceutical enterprises with one-stop supply chain management services covering pre-listing cooperation, import and export services, national circulation, innovation and value-added. Among them, in the first three quarters of 2023, the company's sales of innovative drugs increased by 21% compared with the same period last year, and successfully signed a contract for 21 imported varieties. (2) in the field of "Internet +" pharmaceutical commercial science and technology, Shangyun Health recently completed 500 million yuan C round financing.
Earnings forecast, valuation and rating
We maintain the revenue forecast, and expect the company to achieve revenue of 25722856max in 2023-24-25, an increase of 11%, 11%, 12%, and a net profit of 58x70 / 8 billion, an increase of 3.47%, 19.89% and 14.54%, respectively. Maintain a "buy" rating.
Risk hint
The risks of innovative drugs and the promotion of large varieties of traditional Chinese medicine are not up to expectations and strategic cooperation is not as expected.