Event: a few days ago, I exchanged views with Dong Mi of Huashen Group on the business and future development of the company.
The company's future strategy is mainly medicine, steel components business to maintain steady development. At present, the main profit of the company is the pharmaceutical sector, and the contribution of the steel component sector to the business income is slightly lower than that of the pharmaceutical sector. in the group's plan for the next five years, it is a strategy to give priority to medicine and maintain the steady growth of steel component business. the overall profit will continue to rise.
The promotion of ricardine is limited to the construction of software and hardware in the hospital. Because the drug belongs to the combination of radioactive elements and biological products, first of all, the hospital needs to be qualified to use isotope drugs, and the hardware protection measures can fully keep up with it. Secondly, it also needs medical staff to accept the use of the drug. Therefore, this promotion process is still relatively slow. In the early stage, most of the qualified hospitals may have been covered, and in the later stage, with the construction of hospital facilities, the sales of nicotine will gradually increase.
The market space of rhinitis product line is large. At present, Biyuanshu oral liquid and capsule dosage forms have been widely used in the clinical first-line treatment of rhinitis and sinusitis in similar products. Patients need to pay about 20 yuan for a course of treatment, and the burden is small. Due to the continuous expansion of the company's current sales situation, the growth space of the product in the grass-roots market still exists in the future. The reserve of the new drug Wulong granule mainly treats allergic rhinitis, which will further increase the thickness of the company's products in the field of rhinitis treatment and consolidate its market position.
The gross profit of Sanqi Tongshu capsule will increase. Sanqi Tongshu capsule is currently in the stage of rapid growth, if we further explore the functions of Panax notoginseng related health products, the future market space is still possible to grow. The recent decline in the price of Panax notoginseng is a good thing for enterprises, which will be conducive to cost reduction, but the rate of decline is not expected to be too fast.
Valuation and rating: we expect the company's EPS to be 0.12,0.16,0.21 yuan respectively from 2013 to 2015, with a price-to-earnings ratio of 76 times, 57 times and 43 times respectively. Mainly considering that the future strategic development of the company will be dominated by pharmaceuticals, the overall gross profit margin will rise, but due to the substantial decrease in non-operating income in 2013 and the high base last year, the growth rate of net profit belonging to the parent company is lower than that of operating income. At the same time, considering that it will take some time for Wulong granule and low-dose ricardine to be listed on the market, Huashen Group has a small probability of performance outbreak in the short term and gives it an overweight rating for the first time.
Risk hints: (1) the risk of Wulong granule and low-dose ricardine on the market or lower than expected; (2) the risk of raw material price fluctuation.