Incidents:

The company released its report for the first quarter of 2024. 2024Q1 achieved revenue and net profit to mother of 1,149 million yuan and 163 million yuan respectively, up 1.28% and 4.50% year-on-year respectively.

Demand for large infusion terminals is picking up, and the company continues to expand new products, and the company continues to develop steadily:

2024Q1 achieved revenue and net profit to mother of 1,149 million yuan and 163 million yuan respectively, with year-on-year increases of 1.28% and 4.50%, respectively. Demand for large infusion terminals is picking up, and the company continues to expand new products, driving the company's steady development. Among them, in terms of demand for large infusions, the dosage is highly correlated with the amount of diagnosis and treatment in medical institutions. According to statistics from the National Health and Health Commission, the total number of patients treated in domestic medical institutions gradually recovered from 460 million in January 2023 to 602 million in August 2023, and the total number of patients treated by medical institutions is expected to return to normal levels after the epidemic; in terms of new product development, alanyl glutamine injections, methazolamine injections, sodium metronitrochloride injections, sodium metronitrochloride injections, enoxaparin injections, etc. won the bid in the 8th batch.,

The supply and demand pattern in the infusion industry has improved, and the company's profitability is expected to continue to improve:

After the major domestic infusion industry experienced industry integration, the supply and demand relationship in the industry has now been adjusted to a more balanced state. The supply and demand pattern in the infusion industry has improved, and the company's profitability is expected to continue to improve.

The company's overall gross margin in 2023 was 58.79%, an increase of 2.80 percentage points over the previous year.

Investment advice:

The company's net profit from 2024 to 2026 is estimated to be 573 million yuan, 623 million yuan, and 674 million yuan, respectively, up 9.8%, 8.7%, and 8.3% year-on-year; EPS is expected to be 1.26 yuan/share in 2024, 17 times the current PE, corresponding to a 6-month target price of 21.42 yuan/share, giving a buy-A investment rating.

Risk warning: risk of drug price reduction; sales of core products falling short of expectations; risk of worsening competitive pattern of core products; risk of R&D progress falling short of expectations, etc.