Event: The company released the 2023 equity incentive plan (draft). The performance assessment target is that the 2024-2026 operating income is not less than 111/128/14 billion yuan, or net profit of not less than 8/12/1.5 billion yuan. The initial exercise price of this equity incentive plan is 4.29 yuan/share, and the total number of people granted the plan is 360.

Performance targets show confidence in long-term development, and profit sets high growth targets: equity incentives set high performance targets, demonstrating confidence in the company's long-term development. According to the assessment target, the company's revenue growth rate in 2024-2026 was 15%/9%, the two-year CAGR was 12%, the net profit growth rate was 50%/25%, and the two-year CAGR was 37%, respectively. The revenue-side target reflects the company's confidence in long-term steady development as a leader in private medical examinations. The profit-side target growth rate is impressive, in line with the company's overall development trend; on the one hand, as the impact of the epidemic subsides, the profit level of 2023Q1-Q3 companies continues to recover, and the mother's net profit level continues to recover; on the other hand, as the impact of the epidemic subsides, the profit level of the company continues to recover, and the mother's net profit level continues to recover, and the mother's net profit level has returned to normal Profit increased from a loss of 167 million in Q1 to a profit of 226 million yuan in Q3.

Equity incentives cover a wide range of personnel, which is conducive to increasing employee motivation: the equity incentives were granted to a total of 360 people, including 355 middle managers and core key personnel, and the personnel coverage is wide, which is conducive to increasing the overall enthusiasm of employees; in addition, the number of shares granted by this equity incentive is 78.285 million shares, accounting for 2% of the company's total share capital; equity incentive expenses are amortized over four years, with expenses to be amortized over four years, with expenses to be amortized for 2024-2027, 6167.61/4351/2313.39/58291,000 yuan, respectively. 。

Investment suggestions: We expect the company to achieve operating income of 103.39/116.16/12.929 billion yuan and net profit of 536/8.13/1,233 billion yuan from 2023-2025. The corresponding PE was 50.52/33.33/21.96 times, respectively, maintaining the company's “increased holdings” rating.

Risk warning: risk of medical malpractice, risk of impairment of goodwill, risk of fine management or failure to develop new products as expected, etc.