Core views:
We attach great importance to innovative research and development, and have formed a differentiated innovative product pipeline. The company has been deeply involved in the fields of specialty, chronic diseases and special medicine for many years, and its market share in the treatment fields of chronic kidney disease, transplantation immunity, endocrinology, digestive system, etc. continues to be at the forefront of similar products in China. At the same time, the company already has the world's first novel drug layout in the three core treatment fields of antineoplastic, endocrine, and autoimmunity, and has formed a research and development matrix with three characteristics of ADC, GLP-1, and topical preparations to build differentiated advantages.
The innovation is gradually being realized, and the harvest period is about to be ushered in. The company continues to strengthen the construction of technical platforms and actively promote the progress of clinical trials. According to the company's annual report for the year 23, the company has a total of 111 pharmaceutical research projects, including 73 innovative products and biosimilar projects. Beginning in 2024, the company's innovative products will gradually be marketed and sold, entering the harvest period.
The medical and aesthetic business has created a comprehensive and differentiated product matrix. According to the company's annual report for the year 23, the company currently has 38 “minimally invasive+non-invasive” high-end medical and aesthetic products, of which 24 have been launched at home and abroad, and 14 innovative products are being developed globally. The product portfolio covers mainstream non-surgical medical and aesthetic fields such as improving wrinkles between eyebrows, facial and body filling, thread implants, skin management, body shaping, hair removal, intimate repair, etc., and has formed a comprehensive product cluster. The number of products and coverage areas are at the forefront of the industry.
The registration of domestic medical and aesthetic products is progressing in an orderly manner. The company's main product, Yi Yan Shi, has maintained steady growth. The company continues to promote the launch of domestic medical and aesthetic products. Currently, four injectable products and four energy source products are in the clinical and registration stages, which are expected to contribute new impetus to the company's performance growth after launch. According to the company's annual report for '23, the overseas medical and aesthetic business has achieved annual profits for the first time in '23, and the net interest rate is expected to increase further in the future.
Profit forecasting and investment advice. The company's 2024-2026 EPS is estimated to be 1.93 yuan/share, 2.26 yuan/share, and 2.53 yuan/share, respectively, corresponding to PE17.27x/14.81x/13.22x. Referring to comparable company valuations, we think it is appropriate to give the company a 2024 25xPE valuation, corresponding to a reasonable value of 48.36 yuan/share, and maintain a “buy” rating.
Risk warning. Product launches fall short of expectations; competitive landscape deteriorates; risks such as procurement and health insurance negotiations.