Key points of investment
Performance continued to grow rapidly: the company released the 2023 annual report and the 2024 quarterly report. In 2023, it achieved operating income of 950 million yuan (+64%, year-on-year growth rate, same rate below), net profit to mother of 304 million yuan (+31%), and net profit after deducting non-return to mother of 289 million yuan (+39%). 2023Q4 achieved operating income of 283 million yuan (+105%), net profit to mother of 52 million yuan (+49%), and net profit of 50 million yuan (+90%) after deducting non-return to mother in a single quarter.
2024Q1 achieved operating income of 310 million yuan (+64%), net profit to mother of 103 million yuan (+31%), and net profit after deducting non-return to mother of 99 million yuan (+32%) in a single quarter.
Intraocular lenses are growing steadily, and vision care products are performing well. Looking at business segments, among surgical treatment products, “pronomine” and other series of intraocular lenses achieved revenue of 50 billion yuan, an increase of 41.67% over the previous year. With the gradual restoration of the market environment at the beginning of the year, the number of cataract surgeries increased rapidly, and the company's intraocular lens sales increased at the same time, and domestic annual sales exceeded one million tablets. In the future, with the gradual implementation of intraocular lens collection, the company's high-end bifocal intraocular lenses are expected to accelerate.
At the same time, the international market is also accelerating, and overseas intraocular lens revenue increased by 127.90% year on year. Among myopia prevention and control products, the “Puno Eye” corneal contouring mirror achieved revenue of 219 million yuan, an increase of 26.03% over the previous year. The corneal reshaping lens business is affected by factors such as downgrading consumption and increasing competition, and the market growth rate has slowed. At the same time, the company's “Puno Eye” and “Xinnuoti” defocus lenses are one of the complementary products for corneal shaping lenses, and their revenue increased by 247.32% year on year. Among vision care products, contact lens revenue was 137 million yuan, accounting for 14.36% of revenue, up 1,504.78% year on year, achieving rapid growth. The company continues to improve its contact lens layout, rapidly increase production capacity and accelerate the expansion of the contact lens market through mergers and acquisitions of Tianyan Pharmaceuticals, Fujian Youyoukang, and Meiyuetong. In the future, as the company continues to increase its product promotion efforts and brand marketing, the company's optometry products are expected to continue to be rapidly released.
R&D investment continues to increase, and ongoing research projects are progressing steadily. The company invested 132 million yuan in R&D, an increase of 61.23% over the previous year. The company is positioned as an R&D platform-based enterprise with abundant research projects. Continued increase in R&D investment can effectively guarantee the company's R&D progress. A lens eye intraocular lens (PR) was registered in 2023, and clinical projects such as aspheric trifocal astigmatism correction intraocular lenses and aspherical extended depth of field (eDOF) intraocular lenses are progressing rapidly and progressing well.
Investment advice: Considering that the company's vision care business is in the early stages of expansion and the unit cost is high, we lowered our profit forecast. The company's net profit for 2024-2026 is estimated to be 4.02/5.16/622.9 billion yuan (the previous value of 2024-2025 was 452/604 million yuan), with growth rates of 32%/28%/22%, respectively, and corresponding PE 36/28/23 times, respectively. Considering the continued growth of the company's intraocular lens and OK mirror business, and optometry products are gradually contributing to increased performance, the company's performance is expected to continue to grow rapidly and maintain the “Increase Holds-B” proposal.
Risk warning: risk of price reduction in product collection, risk of product sales falling short of expectations, risk of overseas business expansion falling short of expectations.