Key points of investment

Event: On August 22, 2024, the company released the 2024 semi-annual report: in the first half of 2024, the company achieved revenue of 2.211 billion yuan, +19%; net profit due to mother 0.903 billion yuan, +20% year over year; realized net profit without return to mother of 0.868 billion yuan, +26% year over year; 2024Q2 achieved revenue of 1.19 billion yuan, +20% year over year; achieved Net profit after deducting non-return to mother was 0.468 billion yuan, +27% YoY.

Domestic trends remain positive, and overseas performance continues to grow. In the first half of 2024, domestic market companies completed the installation of 796 fully automatic chemiluminescence instruments, accounting for 75.13% of the installed equipment; the proportion of large-scale machines installed in the domestic market continued to increase, driving a steady increase in revenue from the reagent business. Domestic main business revenue was 1.41 billion yuan, up 16.30% year on year, and its domestic reagent business revenue increased 18.54% year on year, higher than the overall domestic business growth rate, and the growth trend was good; in the first half of 2024, the overseas market sold a total of 2,281 fully automatic chemiluminescence instruments, and the sales share of medium and large light emitting instruments increased to 64.80%, an increase of 10.07% over the same period last year; while the number of installed units in overseas markets increased steadily, the share of medium and large machines continued to rise, laying a solid foundation for overseas reagent sales growth. In the first half of 2024, overseas business revenue was 0.796 billion yuan, up 22.79% year on year. Among them, overseas reagent business revenue increased 29.11% year on year, higher than the overall growth rate of overseas business, and the growth trend is good.

The installed capacity of high-end products continues to grow, leading to an increase in gross profit. With the successive launch of MAGLUMI X3, MAGLUMI X6 chemiluminescence instruments and SATLARS T8 assembly line products, the company's next-generation X series fully automated chemiluminescence instruments and assembly line products have been serialized, with excellent performance and high cost performance advantages, providing important product support for the company to develop various types of terminals at home and abroad. In the first half of 2024, the company's MAGLUMI X8 sold 3170 units at home and abroad. As the sales share of X series and medium and large light-emitting instruments increased, the gross margin of the company's instrument products increased to 32.11%, an increase of 2.46 pct over the previous year. Among them, the gross margin of overseas instruments increased to 39.95%, an increase of 6.31 pcts over the previous year. The gross margin of domestic and overseas reagent products remained stable; the comprehensive gross margin of the company's main business was 72.78%, an increase of 1.29 pct over the previous year.

Profit forecast and investment rating: We basically maintain our previous profit forecast. We expect the company's revenue for 2024-2026 to be 4.96/6.27/7.93 billion yuan, respectively, and net profit to mother 2.06/2.62/3.34 billion yuan, respectively, corresponding to the current stock price PE, which is 24/19/15 times, respectively. We believe that the company is a leading company in the industry and is expected to continue to grow rapidly in the future and maintain a “buy” rating.

Risk warning: the risk of delays in approval and promotion of new products falling short of expectations; risk of dealer management; strategic and management risks brought about by the expansion of business scale.