Revenue grew steadily, and the new Jinsai/Baike product was ready to launch. The target price was 200.80 yuan, maintaining the “purchase” of Changchun Hi-Tech to achieve 1Q24 revenue of 3.18 billion yuan (+14.4% yoy), and a net profit of 859 million yuan (+0.2% yoy). The company's revenue grew steadily and the profit side remained flat. The main reasons were: 1) the steady increase in Jinsai's revenue, driven by the continued high increase in new products; 2) the share of low gross margin real estate business revenue increased (the company's 1Q24 gross profit margin was 83.4%, compared with the 1Q23 gross profit margin of 87.9%); 3) R&D expenses increased slightly. Looking ahead to 24 years, considering the increase in growth hormone's share of long-term revenue and the rise in sales of Jinsai's new products+ the 100 gram shingles vaccine continues to grow, but R&D investment has increased, we are optimistic that the company's net profit will increase by double digits over the same period last year. We expect the company's 24-26 EPS to be 12.55/14.04/15.67 yuan, and give the company 16 times PE in 24 years (24 times discounted compared to the company's consensus expectation of 24-year Wind due to potential growth hormone collection risks), with a target price of 200.80 yuan to maintain the “purchase”.

Jinsai: Long-term efficiency continues to lead, non-core new products for children are poised to launch, and Jinsai achieved revenue/net profit of 24.7/864 million yuan (+5/ -3% yoy) in 1Q24. Steady revenue growth is mainly due to the continued expansion of long-term products. We expect Kinsai's revenue growth rate to be about 10% within 24 years: 1) It is expected to achieve double-digit revenue growth within the year of winning the bid. Complete specifications for water needles and expansion of indications are promising to stabilize income volume; 2) Improved long-term beneficial injection methods+PEG self-production. We expect sales to continue to grow in 24 years (1Q24 accounts for about 30% of growth hormone revenue). In addition, we estimate that the company's 1Q24 revenue contribution from non-growth hormone products is excellent, and we are optimistic that it will continue to increase during the year. We consider: 1) the starting volume of non-pediatric core products will continue to be excellent after launch (the annual revenue impact is expected to impact 300 million yuan); 2) in the field of assisted reproduction, we are optimistic that the revenue contribution of follicle promotion will continue to be repaired; 3) after the launch of new follitin-promoting injections and cuticle anaesthetic products within the year.

100 grams: Strong dosage of the shingles vaccine, optimistic about going higher throughout the year

Baig 1Q24 achieved revenue of 270 million yuan (+51% yoy) and net profit of 25 million yuan (year-on-year increase of over 220%), mainly driven by the continuous release of the shingles vaccine after marketing (we estimate that 1Q24 blisters account for less than 50% of 100g's revenue). Looking ahead to 24 years, we are optimistic that 100g revenue will maintain a high upward trend. Consider: 1) demand for acne batch issuance is stable; 2) blisters have completed entry into all provinces, and sales have continued to grow (18 batches have been issued in batches since the beginning of the year, about 500,000 sticks). In addition, the new products in the company pipeline include: 1) the nasal spray influenza vaccine is being approved for marketing; 2) Phase I of Baibai has been completed (preparations for phase III are in progress), and we estimate that it may be accepted for marketing in '25; 3) the adjuvant influenza vaccine, recombinant herpes vaccine, HSV-2 vaccine, and HiB vaccine will soon be declared for clinical trials in 2024.

Huakang focuses on innovation in traditional Chinese medicine. Real estate is optimistic about contributing to stable cash flow. Huakang 1Q24 achieved revenue of 191 million yuan (+15.8% yoy), and net profit of about 5.25 million yuan (+33% yoy) to mother. We expect the steady growth of major varieties such as Thrombophlein tablets and Yinhuacin tablets in 24 years+the company will continue to explore the value of potential varieties such as Lung Ning Granules and Clear Granules, and revenue estimates double digit year-on-year growth. Real estate achieved revenue/net profit of 236.006 million yuan (+232/ 500% yoy) in 1Q24. In the future, it is optimistic that multiple business formats and diversified development will continue to contribute to stable cash flow.

Risk warning: collection risk, vaccine sales falling short of expectations, new product development failure, and commercialization risk.