Incident: On March 30, 2024, the company released its 2023 annual report. The company achieved operating income of 329 million yuan, an increase of 26.46% over the previous year; net profit attributable to the owner of the parent company was 5.6885 million yuan, an increase of 85.17% year on year; net profit attributable to the owner of the parent company after deducting non-recurring profit and loss was -354.702 million yuan, which has not yet achieved profit.
Comment:
Actively embracing collection, the volume of 3D surgeries is growing rapidly. Domestic market: The company participated in fujian-led inter-provincial alliance electrophysiological collection, Beijing medical institution DRG payment and electrophysiological volume procurement, and Beijing-Tianjin-Hebei “3+N” alliance electrophysiological collection, all of which achieved good results; at the same time, the marketing network service system was continuously upgraded to enhance service quality and the recognition and influence of the company's brand in the market.
In 2023, the company participated in a number of large-scale academic conferences and built an academic platform to share pressure catheter applications, further demonstrating the ability of integrated solutions for diagnosis and treatment. At the end of 2023, the company's products covered more than 1,000 hospitals in 31 provinces, autonomous regions and municipalities across the country, and the total number of 3D surgeries exceeded 50,000.
Steady global strategic development and rapid growth in overseas revenue. Facing a complex international business environment, the company is committed to a global development strategy, focusing on strengthening the establishment of agency channels and increasing overseas clinical usage; with TrueForce? Pressure catheters obtained EU MDR certification and UK UKCA certification, and domestic atrial fibrillation market expansion began to be promoted collaboratively, and the first batch of clinical applications were successfully carried out in Spain, Greece, Poland and other countries; the company actively participated in 20 international conferences including the European Heart Rhythm Conference, the American Heart Rhythm Conference, and the Asia-Pacific Heart Rhythm Conference to comprehensively showcase the company's products and technology, and gradually increase industry popularity in the international market; strengthen overseas market agent training, improve clinical operation application capabilities, and enhance customer satisfaction. At the end of 2023, the international market achieved a year-on-year increase in revenue of more than 50%. It covers a total of 35 countries and regions, with a total of 21 products.
The industry's beta+ individual stocks resonate, and future growth can be expected. As the advantages of cardiac electrophysiological surgery are gradually clinically proven, the number of surgeries using electrophysiological surgery for patients with rapid arrhythmia in China continues to increase. According to Frost & Sullivan statistics and forecasts, the compound annual growth rate of electrophysiological surgeries in China in 2020-2025E is 28%; driven by a series of factors such as the development of 3D labeling technology and the promotion of atrial fibrillation centers, the number of electrophysiological atrial fibrillation surgeries is expected to increase from 101,000 cases in 2021 to 383,000 cases in 2025, with a compound annual growth rate of 39.56%; in August 2023, IceMagic? Balloon cryoablation catheter and IceMagic? The cryoablation device obtained an NMPA registration certificate and became the first domestically produced cryoablation product approved for atrial fibrillation treatment; the pressure pulse ablation catheter project completed clinical enrollment and has entered the follow-up phase. The company invested in Shanghai Shangyang Medical Technology Co., Ltd. to speed up the improvement of the PFA research and development network; the renal artery ablation project entered the clinical trial stage, with Columbus? The 3D cardiac electrophysiological labeling system is used in combination to achieve more accurate target ablation and reduce X-ray damage to the operator and patient. We believe that the electrophysiology industry is developing rapidly. As the industry leader, microelectrophysiology promotes the collaborative layout of the three major energy platforms of “radiofrequency+freezing+pulsed electric field”, and future growth can be expected.
Profit forecast and investment rating: The company's net profit for 2024-2026 is estimated to be 1,585, 3580, and 68.94 million yuan, respectively, up 178.6%, 125.9%, and 92.6% year-on-year. EPS is 0.03, 0.08, and 0.15 yuan, respectively. The PE corresponding to the current price is 714, 316, and 164 times.
Risk factors: R&D risk of innovative technology and products; business channel management risk; product quality and potential liability risk; market competition risk; exchange rate fluctuation risk.