The company's performance has grown rapidly since 2020. In 2019-2023, the company's revenue increased from 423 million yuan to 1,146 million yuan, with a CAGR of 28.30%; net profit to mother increased from 101 million yuan to 329 million yuan, with a CAGR of 34.34%. In 2023, the company achieved revenue of 1,146 million yuan/yoy +16.6%, and achieved net profit of 329 million yuan/yoy +30.66%. The performance continued its high growth trend.
In vitro diagnosis+treatment and rehabilitation two-wheel drive, the treatment and rehabilitation business performed well in 2023. In 2023, the in vitro diagnostic business achieved revenue of 829 million yuan/yoy +10.73%, with a gross profit margin of 65.22% /yoy+8.95pct. The growth was mainly due to improved product competitiveness and continued improvement in clinical applications. In particular, the two major product series of luminescence and saccharification performed well. In 2023, the treatment and rehabilitation business achieved revenue of 304 million yuan/yoy +33.79%, with a gross profit margin of 70.83% /yoy+2.77pct. The growth was mainly due to the continuous growth of core clinical medical products such as air waves and phlegm removal machines, as well as the accelerated promotion of medical and aesthetic products such as cold lift and ultrasound V in Latin America.
The glycated hemoglobin testing market has broad scope for development, and the company's glycated hemoglobin testing products are expected to continue to rise. Diabetes is one of the most common chronic diseases in China. Since diabetes is difficult to cure, patients usually require long-term monitoring. In the field of glycated hemoglobin testing, the company has developed a series of glycated hemoglobin analyzers and supporting test reagents and chromatographic columns to rapidly detect glycated hemoglobin (HbA1c) based on high-performance liquid chromatography analysis technology, which can support diabetics to obtain more accurate diagnosis. The company's new-generation high-speed glycated hemoglobin analyzer (H100plus) and supporting reagents have received high recognition in the international market and are currently in a continuous phase of production.
The share of high value-added businesses such as medicine and aesthetics is expected to continue to increase in the future. The company has successively acquired Chongqing Jingyu Laser Technology Co., Ltd. and Shenzhen Weirenguangda Technology Co., Ltd., further enriching and perfecting the company's layout in the field of dermatological and aesthetic products. The company's flagship product, Cold Lift, which was launched at the end of 2022, is being promoted at an accelerated pace; ultrasonic V sales volume in Latin America, which was launched in the first half of 2023; the intense pulsed light therapy device (MM light) was launched at the end of November 2023, and some regions have already signed contracts with agents. Judging from the market situation, market feedback is good; the core components of the Q-switched laser therapy device have successfully achieved independent R&D and production; the upgraded red and blue light therapy device is already finished. The company combines “cold lift+ultrasound V Latin American+MM light” into the “Three Masters of Anti-Aging”, which are positioned as natural anti-aging, ultrasonic anti-aging, and full-body whitening. Driven by major products, the medical and aesthetic business is expected to expand rapidly. We expect the dermatology and aesthetic business to reach a high growth rate of more than 50% in 2024.
Profit forecast and investment rating: We expect the company's revenue for 2024-2026 to be 1,43/17.2/2.02 billion yuan, respectively, with year-on-year growth rates of 25.1%/20.2%/17.7%, and net profit to mother of 4.3/54/6.4 billion yuan, respectively. The year-on-year growth rates are 31.4%/23.9%/20.7%, and the corresponding EPS is 1.01/1.25/1.51 yuan respectively, corresponding to PE 17/14/12 times, respectively. The company focuses on the two major sectors of in vitro diagnosis and treatment and rehabilitation. The medical and aesthetic business is developing at an accelerated pace, and the overall performance has maintained a high growth trend. For the first time, it has been covered and given a “buy” rating.
Risk factors: collection policy risk; risk of R&D and approval falling short of expectations; market competition risk.