Core views:
Regular business continues to resume. According to the company's annual report for the year 23, the company achieved revenue of 2,765 billion yuan (YOY -51.33%); gross profit margin of 62.61% (YOY+10.79PP); net profit to mother of 488 million yuan (YOY -59.26%). The decline in performance was mainly due to a decline in the company's unconventional business, but the growth rate of conventional business was strong. According to the 24Q1 report, the company achieved revenue of 881 million yuan (YOY +3.54%), net profit to mother of 218 million yuan (YOY +7.2%), and gross profit margin of 66.3% (YOY+1PP). According to Wind, 224Q1 performance achieved year-on-year growth based on a high base. We expect this is due to a recovery in the number of tests for respiratory disease infections in the country.
Strategic breakthroughs in two major fields. According to the company's annual report for 23 years, (1) in the field of chemiluminescence, the company launched the ultra-high-speed FC-9000 series and the desktop FC-2000 fully automatic chemiluminescence immunoanalyzer. In the field of chronic diseases, the company lays out detection markers such as blood clots, hypertension, and eclampsia as special projects to meet differentiated clinical needs. The company's single-component luminescence products work in synergy to achieve full coverage from low to high level hospitals. (2) In the field of molecular diagnosis, the company's self-developed fully automatic nucleic acid amplification analysis system actively helps in fields such as disease control and customs quarantine; the company launched molecular POCT and conventional fluorescence PCR multiple pathogen detection kits; in the field of pathology, the company continues to expand operating terminals, with the top three hospitals accounting for more than half.
The company's overall cost rate increased. According to Wind, the company's 23-year sales expense ratio is 23.51% (YoY+7.15PP), mainly due to a reduction in marketing expenses and a sharp drop in the company's revenue; the management expense ratio is 8.21% (YoY+4.2pp), due to an increase in the company's share payments and intermediary fees; and the R&D expense ratio of 13.67% (YoY+6.3pp), we expect the company's project investment to expand.
Profit forecasting and investment advice. We expect the company's 24-26 EPS to be 1.34 yuan/share, 1.74 yuan/share, and 2.36 yuan/share, respectively. Referring to comparable companies, we will give the company a 24-year PE valuation of 20 times, corresponding to a reasonable value of 26.73 yuan/share, and maintain a “buy” rating.
Risk warning. R&D falls short of expectations; policy risks; sales of new products fall short of expectations.