Key points of investment:
IVD and rehabilitation medicine and aesthetics are dual-drive, platform-based device layout. The company was founded in 2008 with a platform-based layout around the three major fields of clinical rehabilitation, IVD, medicine and aesthetics. The performance growth was highly realized. The revenue and net profit CAGR for 2019-2023 reached 28% and 34% respectively. IVD+ rehabilitation medical and aesthetic two-wheel drive, with full expansion at home and abroad, and the momentum for performance growth continues to be strong.
IVD: Domestic pioneer of electrochemiluminescence, opening up space for saccharification to go overseas 1) Chemiluminescence: Instrument-driven reagent dosage trends are obvious. The company's electrochemiluminescence product eCL8000 was launched in 2017. It is the second in the world and the first domestically produced. It has broken the monopoly of imported technology and has excellent performance indicators. At the same time, the ECL9000 series of large-scale electrochemiluminescence equipment has been on the market for 22 years, and the layout of large and small light-emitting products is complete. The company's differentiated light-emitting route advantages led to a good bid for mining in Anhui. As harvesting progresses, the share is expected to increase at an accelerated pace; 2) Saccharification:
Breaking through the barriers of core technology chromatography media production, the dual detection mode hemoglobin analyzer was highly recognized by the international market. In 2020, overseas ODM cooperation was explored, and overseas volumes grew rapidly.
Rehabilitation: Big market for rehabilitation devices. The company has created a complete solution for the 100 billion market for rehabilitation devices. The company's photonic therapy products have an obvious first-mover advantage, and the core technology and main performance indicators are excellent. The company focuses on the advantages of photonic therapy devices to create eight major rehabilitation and treatment solutions to meet the diverse needs of patients in all aspects. The treatment and rehabilitation business achieved revenue of 300 million in 23 years (+34% year-on-year), maintaining a rapid growth trend. Furthermore, the company acquired Zhixin Biotech in July 2022 to expand the endoscope layout and further enrich and improve the rehabilitation product line.
Medical beauty: The photoelectric medical and aesthetic layout was quickly completed. The cold lattic+V Latin American high-speed release was underway. The company acquired Chongqing, Beijing and Chongqing in 2020 and 2021 and quickly entered the medical and aesthetic circuit. After 21 years of independent research and development, the new ultrasonic V Latin American and MM light products were launched in 2023, and the cold lattic+V Latin American+MM light “anti-aging+restoration+whitening” combination punch is expected to expand rapidly in the future.
Profit forecasting and investment advice
We expect the company's revenue for 2024-2026 to be 1.44 billion yuan, 1.85 billion yuan, and 2.36 billion yuan respectively, corresponding year-on-year growth rates of 26%, 28%, and 28%, respectively. The company's net profit to mother for 2024-2026 is estimated to be 420 million, 540 million yuan, and 690 million yuan respectively, with growth rates of 29%, 28%, and 28% respectively.
Using the comparable company valuation method, we selected 4 listed companies in the field of in vitro diagnosis: Mindray Healthcare, Antu Biotech, Xinye, and Yahuilong; Xiangyu Healthcare, a listed company in the field of treatment and rehabilitation; and Haohai Biotech, a listed company in the medical and aesthetic field, as comparable companies. In 2024, the average PE of comparable companies was 25.1 times. Considering the Pumen Technology Rehabilitation and Aesthetic+In Vitro Diagnosis dual drive, both major business segments had high growth potential and were covered for the first time, giving them a “buy” rating.
Risk warning
Risk of winning bids in the IVD sector falling short of expectations, risk of worsening competitive patterns in the medical aesthetic and IVD industries, risk of falling short of expectations in the promotion of medical and aesthetic products