Event: the company recently released its 2023 semi-annual report, with a revenue of 749 million yuan (yoy+12.18%) in the first half of 2023, a net profit of 134 million yuan (yoy+30.13%) and a non-return net profit of 131 million yuan (yoy+29.32%). The annual R & D cost of 2023H1 is 41.68 million yuan (yoy+72.24%), the sales cost is 137 million yuan (yoy-2.3%), and the management cost is 63.06 million yuan (yoy-8.55%). The net interest rate is 17.88% (2.47pp higher than 2022H1).

Comments:

Multi-dimensional (12) steady growth, adult / child multi-dimensional (13) in the market introduction period, waiting for volume

① injection multivitamin (12) is the first imitation in China, an exclusive domestic variety, the original research manufacturer is Baxter, the market share has been maintained at more than 80% for a long time, and 2023H1 achieves an income of 546 million yuan (yoy+14%). ② Children's multivitamin injection (13), which was put on the market in 2018, is the first imitation in China and an exclusive domestic breed. It was included in the national health insurance in 2023 and was implemented on March 1. 2023H1 achieved a sales income of 22.23 million yuan (yoy+8.61%). ③ multivitamin (13) for injection was approved to be put on the market at the end of August 2022, and has entered the preliminary examination list of health insurance negotiation in 2023. 16 provincial administrative regions have won the bid / set up the net. Guangzhou Hanguang Pharmaceutical is the only one of the 13 similar vitamin injection products approved in China, and the competition pattern is good, which is expected to fill the multi-dimensional 12 market.

A variety of trace element injection due to the impact of local collection, income slightly increased ① multi-trace element injection (40ml) on the market in March 2020, the first imitation in China, domestic exclusive species, listed into the medical insurance, has completed 28 provinces of bid / net, compared with a variety of trace element injection (II), one more component (cobalt), formula proportion optimization. 2023H1 sales income 86.93 million yuan (yoy+3.68%) ② multi-trace element injection (Ⅰ) is suitable for children (submitted for approval in May 22), multi-trace element injection (Ⅲ) is under examination and approval.

Distribution of amino acids and electrolytes to form a total nutritional support matrix Children compound Amino Acid injection (19AA-I) and compound Amino Acid injection (20AA) were approved to be put on the market in May and October 2022, respectively. 2023H1 has won the bid in 30 and 26 provinces respectively. Compound electrolyte injection (V, the first imitation in China, which has been included in the 2023 health insurance negotiation list) (II) has won the bid / set up the net in 25 and 19 provinces respectively.

Profit forecast: we expect the company's operating income to be 1.638 billion yuan, 1.936 billion yuan and 2.266 billion yuan respectively from 2023 to 2025; the net profit from returning to the mother is 231 million yuan, 287 million yuan and 389 million yuan respectively; and the EPS for 2023-2025 is 0.53,0.66 yuan and 0.89 yuan respectively, and the corresponding PE valuation is 20, 16 and 12 times respectively.

Risk factors: the risk of intensified product competition; the lower-than-expected progress of research and development; the risk of policies such as collection and acquisition.