Incidents:
On April 26, 2024, Guizhou Sanli disclosed its 2023 annual report and 2024 quarterly report. In 2023, the company achieved operating income of 1,635 million yuan, +36.10% year over year; realized net profit of 293 million yuan, +45.42% year over year; realized net profit of 246 million yuan without return to mother, +26.21% year over year. In 2024Q1, the company achieved operating income of 422 million yuan, +20.93% year over year; net profit to mother was 56 million yuan, +2.03% year over year; net profit after deducting non-return to mother was 56 million yuan, +4.95% year over year.
Expand the self-operated sales team and enrich the marketing system through multiple channels
In 2023, the company completed the acquisition of control of Hanfang Pharmaceutical and integrated its sales force, and formed a prescription division and OTC division to further increase the development of OTC channels while continuing to develop hospital channels. In 2023, the company developed more than 700 new hospital channels; developed 15 new top 100 chains; developed more than 600 small and medium-sized pharmacy chains; and developed more than 60,000 new third terminals. In terms of online channels, the company signed cooperation agreements with Ali Health, Jingdong Pharmacy, Meituan, etc., began experimenting with online channel sales, and completed product sales tasks as planned throughout the year, achieving a breakthrough in the company's e-commerce sales channels.
Completed phased capital operations with remarkable results
At the beginning of 2023, the company invested in Haosite and indirectly controlled Invincible Pharmaceutical, and included Hanfang Pharmaceutical in the scope of the merger in November 2023. Together with Dechangxiang, an investment holding company in 2022, the efficiency of investment mergers and acquisitions was released, and the product line was expanded. The diversified product structure brought by the four pharmaceutical companies Sanli, Dechangxiang, Hanfang Pharmaceutical, and Invincible Pharmaceutical achieved volume through synergetic effects. Each unit was profitable in 2023, which had a significant positive impact on the company's revenue and profits.
Profit Forecasts and Investment Ratings
2024Q1's performance continues to grow, and we believe that with factors such as the rapid expansion of the company's OTC channel, the performance is expected to continue to grow steadily. Taking into account factors such as changes in the product structure of the company due to the merger of Chinese medicine, we adjusted the 2024-2025 revenue from 19.51/2,430 billion yuan to 24.42/2,858 billion yuan, and the 2026 revenue forecast to be 3.285 billion yuan; the net profit forecast for 2024-2025 was adjusted from 318/417 million yuan to 325/400 million yuan, and the net profit forecast for 2026 was 464 million yuan. Maintain a “buy” rating.
Risk warning: industry policy risk, cost increase risk, product concentration risk, product price reduction risk, management risk.