Recommended logic: 1) The pandemic has spawned demand for molecular diagnosis. In-hospital instruments and testing personnel are well allocated, and the market is fully educated. From 2021 to 2025, the Chinese molecular diagnosis market will maintain a compound growth rate of 24.1%, exceeding the global growth rate (about 5%). 2) Respiratory testing is in high demand, and joint testing products continue to heat up. In 2023, the company's respiratory product revenue exceeded 0.4 billion yuan, a year-on-year increase of more than 680%. 3) Provide a panoramic solution for molecular diagnosis, covering testing services such as respiratory pathogens, viral hepatitis, HPV, nucleic acid blood screens, drug sensitivity, and electrochemiluminescence to help the company develop in the medium to long term.
The pandemic has spawned demand for molecular diagnostics, and the future is expected to usher in rapid growth. Molecular diagnosis refers to genetic information detection technology that uses molecular biology technology to code disease-related proteins, enzymes, antigen antibodies, and various immunoactive molecules. It has the advantages of short detection time, higher sensitivity, and greater specificity. China's molecular diagnosis market started late and is relatively small. The molecular diagnosis market size in 2019 was 8.4 billion yuan. Benefiting from COVID-19 nucleic acid testing needs, in-hospital diagnostic instruments (such as PCR instruments) and testing personnel have been fully deployed, and related industries have ushered in a period of rapid development. The search for high-quality application places for molecular diagnosis in the “post-pandemic era” has become the key to manufacturers' layout and victory.
Respiratory testing is in high demand, and joint testing products continue to heat up. Respiratory infections are diseases caused by pathogenic microorganisms invading the respiratory tract and multiplying. They can be divided into upper respiratory tract and lower respiratory tract infections. They occur mostly in winter and spring, and winter and spring are high influenza seasons. At present, respiratory diseases such as influenza in China are showing a continuous upward trend. The company has formed a testing matrix covering more than 60 types of respiratory products, and has built a full-process solution for accurate respiratory testing from rapid identification to drug sensitivity assessment to accurate medication use to meet the needs of accurate diagnosis and treatment of clinical respiratory diseases. The company's major products are respiratory six joint testing products. In 2023, the company's respiratory product revenue exceeded 0.4 billion yuan, an increase of more than 680% over the previous year.
Support the 2030 elimination plan for the two major diseases “viral hepatitis” and “cervical cancer.” The WHO proposed eliminating the threat of viral hepatitis and cervical cancer to public health by 2030. China has made specific requirements and measures for prevention, control, diagnosis and treatment of the two diseases at the policy and technical levels, but due to problems such as a large patient base and uneven medical distribution, it still faces two low challenges: “low diagnosis rate” and “low treatment rate.” Currently, the diagnosis rate of hepatitis B, hepatitis C, and HPV is about 30-40%. According to WHO requirements, the diagnosis rate should reach 90% by 2030. It is estimated that the hepatitis and HPV diagnosis market still has 2 to 3 times more room to penetrate.
Profit forecasting and investment advice. Considering that the company has a panoramic solution for molecular diagnosis and that its business layout for respiratory pathogens, viral hepatitis, HPV, and nucleic acid blood screening has competitive advantages, the company is entering a rapid development path. We expect the company's revenue for 2024-2026 to be 1.5/2/2.7 billion yuan, respectively, and net profit to mother of 0.35/0.47/0.65 billion yuan respectively. This is the first coverage. We recommend that you pay attention.
Risk warning: Industry competition increases risk, risk of seasonal fluctuations in sales revenue, risk of R&D progress falling short of expectations.