Maintain an increase in holdings rating. Maintain the 2024-2026 EPS forecast of 0.43/0.50/0.59 yuan, maintain the target price of 15.91 yuan, corresponding to 2024 PE 37 X, and maintain the holdings increase rating.
It is proposed to acquire a holding group of 52 ophthalmology medical institutions. The company plans to acquire part of the shares in 52 medical institutions including Chongqing Eye Vision Ophthalmology Hospital, Zhoukou Aier Eye Hospital, and Zunyi Aier Eye Hospital held by industrial investment funds such as Hunan Liangshi Morning Star, Nanjing Aier Anxing, Wuhu Yuanxiang Tianyou, Hunan Liangshi Longstar, and Hunan Liangshi Ruixing.
The acquired hospital is in a period of rapid growth, and the valuation is reasonable. The 52 standard medical institutions achieved a total operating income of 753 million yuan and a net profit loss of 64.27 million yuan in 2022; in 2023, they achieved total operating income of 954 million yuan (up 26.67% year on year), net profit profit of 16.31 million yuan, net interest rate 1.71 percent; most of the target hospitals opened in 17-20 and were nurtured by merger and acquisition industry funds, which have formed a good foundation for development. In the future, after joining the listed company system, they will give full play to healthcare, The advantages of integrated teaching and scientific research platforms and rich experience in mergers and acquisitions integration provide systematic support and precise support through the Group's comprehensive capabilities of various professional groups, divisions, provinces and regions to continuously improve the business conditions, market position and profitability of the target company, and it is expected that it will accelerate its contribution to performance in the future.
The total acquisition of some of the shares of 52 companies corresponds to a transaction price of 1,344 billion yuan, with an overall valuation of 1,929 billion yuan, corresponding to the 2023 PS 2.02 X, which is reasonable.
Improve the layout of the sinking market and consolidate and enhance the leading position in the industry. Mergers, acquisitions and restructuring are an important way for listed companies to grow bigger, stronger, and speed up their layout. Since its listing, the company has accumulated rich experience in mergers and acquisitions at home and abroad through a “two-wheel drive” development model of endogenous growth and epitaxial expansion, which has strongly promoted the gradual achievement of strategic goals. By the end of 2023, there were 881 Aer brand hospitals, ophthalmology centers and clinics worldwide, including 750 in the mainland (439 listed companies and 311 M&A funds), in addition to 8 in Hong Kong, China, 1 in the US, 108 in Europe, and 14 in Southeast Asia, gradually forming a global medical service network. At present, the layout of large and medium-sized cities across the country has basically been achieved. Among the targets of this acquisition, with the exception of Chongqing Optometry and Nanchang Hongcheng Air, the vast majority were municipal and county hospital projects. The target hospitals had a growth rate higher than the overall growth of the local ophthalmology industry, and their market share continued to increase. After the acquisition, it is conducive to improving the regional market layout as soon as possible, forming a scale effect, further deepening the “hierarchical chain” system across the country, and consolidating and enhancing the leading position in the industry.
Risk warning: The recovery in consumer health care fell short of expectations, and hospital expansion fell short of expectations.