昆药集团(600422)公司首次覆盖报告:华润三九入主掌舵 “慢病+国药”核心两翼促新生

First coverage report of Kunming Pharmaceutical Group (600422): China Resources 39 takes the helm of the “Chronic Diseases+Sinopharm” core wings to promote new life

開源證券 ·  Jan 23

China Resources 39 takes the helm, fully empowering business transformation and development

The predecessor of KPC Group was founded in 1951, and was listed in 2000 after restructuring in 1995. The company's base is located in Yunnan, which is rich in plant resources. It has successively developed a specialty botanical medicine industry with the main series of artemisia, ginseng, and Tianma, and also laid out the “Kunming Traditional Chinese Medicine 1381” boutique Chinese medicine platform. It has now formed three major divisions of “1381, 1951, and 777”, further clarifying the key grippers for the company's development. In December 2022, China Resources 39 joined KPC Group, and the company ushered in new development opportunities. We expect the company's net profit for 2023-2025 to be 483/640/758 million yuan, EPS is 0.64/0.84/1.00 yuan, and the current stock price is 28.6/21.6/18.2 times PE. There is plenty of room for future growth in chronic disease management and boutique Chinese medicine businesses, and for the first time, it is covered with a “buy” rating.

Set the pulse of industry development and follow the trend to promote enterprise take-off

China is currently facing a trend of population aging. By the end of 2022, the country's population aged 60 and over reached 280 million, accounting for 19.8%. The country attaches great importance to this. In 2022, the National Health Commission and other departments successively issued the “14th Five-Year Plan” and the “Implementation Plan for Strengthening Traditional Chinese Medicine Health Services for the Elderly”, proposing to give full play to the positive role of traditional Chinese medicine in health maintenance, disease prevention and rehabilitation for the elderly.

In addition, since 2022, the country has also introduced a number of policies to encourage innovation and development of the traditional Chinese medicine industry, and has actively included marketed new drugs in the medical insurance catalogue. We believe that with the growing development of the “silver hair economy” and the popularization of concepts such as traditional Chinese medicine to prevent chronic diseases, the traditional Chinese medicine industry now has a favorable environment for continuous development.

Focusing on empowering the core brand business, “37+ Kunming Traditional Chinese Medicine” ushered in a new chapter of development. The company's strategic goal is to become “the first stock of Yinfa Health”, and “chronic disease management+boutique Chinese medicine” as its two core business ideas. In terms of the 37 industry, expand the 37 industry chain layout vertically and horizontally, create a product matrix represented by “Blood Saetong Softgels”, form a product gradient of “gold single+category clusters”, explore market demand from multiple angles, and build a chronic disease management platform. In terms of traditional Chinese medicine, the focus is on building strong single products centered around the Kun Traditional Chinese Medicine brand IP, and cultivating second-tier products with high growth potential, such as Shenling Spleen Health and Stomach Relief Granules, and forming a high-end Chinese medicine platform with rich clusters and gradients. At the same time, in the future, KPC Group will join hands with China Resources 39 to focus on supporting the two core brand businesses in innovative R&D pipelines and marketing channel expansion to build a competitive advantage for long-term development.

Risk warning: Business integration falls short of expectations, product sales fall short of expectations, and new product development speed falls short of expectations.

The translation is provided by third-party software.

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