Results for the first half of 2024 exceeded expectations, and profitability continued to improve

In the first half of 2024, the company achieved revenue of 2.841 billion yuan (+5.59% compared to the previous year), net profit to mother of 0.726 billion yuan (+28.12%), net profit of 0.724 billion yuan (+29.43%) after deducting non-return net profit of 25.48% (+4.7pct). Looking at 2024Q2 alone, the company achieved revenue of 1.619 billion yuan (+15.73%), net profit of 0.409 billion yuan (+34.1%), net profit of 0.411 billion yuan (+34.31%) of non-return net profit, and 25.39% (+3.52pct) of non-net profit. The company's 2024 financial budget determines that the 2024 revenue target will reach 6.126 billion yuan, and the net profit target will reach 1.791 billion yuan. We are optimistic about the long-term development of the company. We added a profit forecast for 2026, raised the profit forecast for 2024 (the original forecast was 1.409 billion yuan), and lowered the profit forecast for 2025 (the original forecast was 1.807 billion yuan). The net profit for 2024-2026 is 1.412/1.739/2.194 billion yuan. The current stock price corresponds to a PE of 32.8/26.6/21.1 times, maintaining a “buy” rating.

The new pulp station expanded smoothly, and the amount of pulp collected maintained a relatively rapid growth

In 2023, the company's 79 active single plasma collection stations collected 2,415 tons of plasma, an increase of 18.67% over the previous year, and continued to maintain the advanced level in China. The company actively promotes work related to the construction and application of its pulp stations. Up to now, the company has 80 pulp stations.

Products under development are progressing smoothly, and chromatography is expected to contribute significantly to significant performance growth. Fourth-generation 10% concentration intravenous human immunoglobulin prepared by Chengdu Rongsheng chromatography process in 2023 (Rongsheng Jing C? 10%) First approved for marketing in China, Chengdu Rongsheng's injectable recombinant human coagulation factor VIII obtained marketing approval; Chengdu Rongsheng's fibrinogen and Lanzhou blood human prothrombin complex are in the marketing license application stage; projects such as Chengdu Rongsheng subcutaneous human immunoglobulin and injectable recombinant human coagulation factor VIII-Fc fusion protein and Guizhou blood prothrombin complex obtained the “Drug Clinical Trial Approval Notice”. In 2023, the company completed the listing registration of intravenous human immunoglobulin (pH4) and tetanus immunoglobulin in Macau; products such as intravenous human immunoglobulin (pH4), tetanus human immunoglobulin, and rabies immunoglobulin were exported.

Risk warning: Pulp production growth falls short of expectations, new product launches fall short of expectations, product sales fall short of expectations, etc.