Yixintang Pharmaceutical (002727) Southwest Securities·2024-11-03 06:06Investment Rating - The report does not specify a clear investment rating for the company [5] Core Views - The company reported a revenue of 13.59 billion yuan for the first three quarters of 2024, representing a year-on-year increase of 6.1%. However, the net profit attributable to shareholders decreased by 57.4% to 290 million yuan, and the net profit after deducting non-recurring gains and losses fell by 49.4% to 340 million yuan [1] - In Q3 2024, the company achieved a revenue of 4.28 billion yuan, an increase of 3.6%, but the net profit attributable to shareholders plummeted by 94.2% to 110 million yuan, with a 74% decrease in net profit after deducting non-recurring gains and losses to 450 million yuan [1] - The company is accelerating its expansion outside of Yunnan, focusing on the southwestern region, with a total of 11,516 direct-operated stores as of the end of Q3 2024, a net increase of 1,261 stores since the beginning of the year [2] - The company aims to explore opportunities in the health industry by introducing beauty, personal care, and maternal and infant products to create new revenue growth points and enhance brand recognition among younger consumers [2] - Revenue forecasts for 2024-2026 are projected at 18.9 billion yuan, 21.9 billion yuan, and 25.4 billion yuan, with year-on-year growth rates of 8.9%, 15.7%, and 16.0% respectively [2] Summary by Sections Financial Performance - For 2023A, the company reported a revenue of 17.38 billion yuan, with a projected revenue of 18.92 billion yuan for 2024E, reflecting a growth rate of 8.89% [3] - The net profit attributable to shareholders is expected to decrease from 549.44 million yuan in 2023A to 394.95 million yuan in 2024E, indicating a decline of 28.12% [3] - The earnings per share (EPS) is projected to be 0.66 yuan in 2024E, down from 0.92 yuan in 2023A [3] Business Segments - The core business of the company is the retail of Chinese and Western medicines, which is expected to account for approximately 75% of total revenue, with a projected growth rate of 8.5% for 2024 [7] - The Chinese medicine retail segment is anticipated to grow at a compound annual growth rate (CAGR) of 30% from 2024 to 2026, benefiting from the company's leading position in the southwestern and southern regions [7] - The medical devices and other products segment is expected to see a growth rate of 0% in 2024, with a recovery projected in 2025 [7] Market Expansion - The company is focusing on expanding its store presence in the southwestern region, with significant new openings in Sichuan, Chongqing, and Guizhou, which accounted for 41% of new stores in the first three quarters of 2024 [2] - The proportion of stores outside Yunnan has increased to 51.6%, up by 5 percentage points from the beginning of the year [2]