The company's recent situation
The company issued an announcement on the “2024 Restricted Stock Incentive Plan (Draft)”. The incentive plan plans to grant 2.6219 million restricted shares, accounting for 0.32% of the company's total share capital of 824 million shares. The initial grant price is 88 yuan/share.
reviews
Release a new incentive plan to continue strengthening business cohesion. According to the announcement, the incentive program granted a total of 833 people for the first time. The main incentive targets include the company's core technical personnel, middle management, and others that the board of directors believes need incentives, accounting for about 11.20% of the company's total number of 7,440 employees as of the end of 2023. On the other hand, the first restricted stock assessment year granted under this incentive plan is for the three fiscal years 2024-2026, which is assessed once per fiscal year, based on the company's 2023 operating income, which corresponds to a 20% revenue growth rate for 2024-2026. We believe that the company has released a new incentive plan for core technicians and middle management, which is expected to consolidate talent advantages in an increasingly competitive environment, further strengthen business cohesion and output, and guarantee talent support for business development.
A recovery in hospital bidding can be expected, while focusing on the implementation of long-term competitiveness. The 1Q24 company's revenue growth has slowed. We believe that it was mainly due to the catalytic demand for domestic interest-rate loan policies at the end of 2022, which brought about a high 1Q23 base. At the same time, due to the restructuring of the 2H23 medical industry, the slowdown in hospital side bidding to varying degrees affected 1Q24 reporting side growth performance. Looking ahead to the whole year, considering the pace of restructuring work in the domestic medical industry, we expect hospital side recruitment activities to show a quarterly recovery trend in 2-3 Q24 throughout the year. At the same time, although the medical equipment industry has been disrupted to a certain extent in the short term, as the company's product strength and market recognition continue to increase, the certainty of commercialization of the company's products at home and abroad continues to increase. We also recommend paying attention to the implementation of the company's long-term competitiveness.
Continued emphasis is placed on shareholder feedback. According to previous announcements, the company expects to pay a total cash dividend of about 689 million yuan in 2023 (including 485 million yuan of shares purchased in cash), accounting for a total of 34.9% of net profit due to mother in 2023, and continues to pay attention to shareholder feedback.
Profit forecasting and valuation
We keep our 2024/2025 profit forecast of 2,389 billion yuan/2,816 billion yuan unchanged, and keep our target price of 160 yuan (based on the DCF model) unchanged. There is 25.4% room to rise from the current closing price, and maintain our rating of outperforming the industry.
risks
Geopolitical friction intensified, the recovery in hospital bidding fell short of expectations, and competition in the industry intensified.