持续股权激励目标明确。2024 年9 月10 日，公司发布2024 年股票期权激励计划，拟向激励对象186 人，授予1,131 万份股票期权，占总股本2.64%，行权价格为13.80 元/股。业绩考核目标对应收入和净利润，24-26 年增长率目标值均分别为23%、46%、69%，触发值均分别为18%、36%、54%，自2021 年起，公司连续推出4 期股权激励，体现公司对于核心业务人员的重视，以及业务完成的信心。Incident: The company released its 2024 mid-year report. The first half of the year achieved revenue of 0.59 billion yuan (yoy +5.64%, same below), realized net profit of 0.172 billion yuan (yoy +27.78%), and realized net profit of 0.163 billion yuan (yoy +29.16%) after deducting non-return to mother. In Q2 2024, revenue of 0.284 billion yuan (yoy +1.27%) was achieved, net profit due to mother was 0.065 billion yuan (yoy +39.33%), and net profit of non-return to mother was 0.06 billion yuan (yoy +37.86%).
In-vitro diagnosis is growing steadily, and the treatment and rehabilitation stages are under pressure. In the first half of 2024, the company's in vitro diagnosis revenue was 0.468 billion yuan (yoy +21.67%), maintaining steady growth. Treatment and rehabilitation revenue was 0.114 billion yuan (yoy -31.96%). We think it may be related to the base of expectoration devices and high-flow medical respiratory humidifier products over the same period; the domestic revenue scale was 0.429 billion yuan (yoy +1.58%), and the international revenue scale was 0.161 billion yuan (yoy +18.26%), and the company increased the international market Localized personnel recruitment and team building have laid the foundation for the steady growth of the international in vitro diagnosis business.
The gross margin has been rising steadily, and the quality of operations has gradually improved. In the first half of 2024, the company's overall gross margin was 69.82% (yoy+4.61pct), mainly due to a further increase in the gross margin of the in vitro diagnosis business compared to the full year of 2023, reaching 70.54%. The share of sales of high-margin products increased, and unit costs decreased. During the same period, the sales expense ratio was 16.97% (yoy-2.66pct), and the R&D expense ratio was 16.74% (yoy-0.7pct). The cost reduction and efficiency were significant. The net cash flow from operating activities increased by 33.81% year on year, and the quality of operations gradually improved.
The goal of continuing equity incentives is clear. On September 10, 2024, the company announced the 2024 stock options incentive plan. It intends to grant 186 incentive recipients 11.31 million share options, accounting for 2.64% of the total share capital, and the exercise price is 13.80 yuan/share. The performance assessment targets correspond to revenue and net profit. The 24-26 growth rate targets are 23%, 46%, and 69%, respectively, and the trigger values are 18%, 36%, and 54% respectively. Since 2021, the company has launched 4 consecutive equity incentives, reflecting the importance the company attaches to core business personnel and confidence in business completion.
Profit forecasting and valuation. We expect the company's total revenue for 2024-2026 to be 1.354, 1.641, and 2.008 billion yuan, respectively, with growth rates of 18.22%, 21.19% and 22.35% respectively; net profit to mother for 2024-2026 will be 0.406, 0.501, and 0.617 billion yuan, respectively, with growth rates of 23.57%, 23.51%, and 23.05% respectively. The PE corresponding to the current stock price is 13x, 11x, and 9x, respectively. Based on the company's misplaced competitive advantage in IVD, the treatment and rehabilitation business is in a stage of rapid growth, maintaining a “buy” rating.
Risk warning. Industry competition increases the risk, the risk of new product promotion falling short of expectations, and the risk of policy changes.