YILING PHARMACEUTICAL(002603) 湘财证券·2024-11-08 06:25Investment Rating - The report maintains a "Buy" rating for Yiling Pharmaceutical (002603 SZ) [2] Core Views - Yiling Pharmaceutical's Q3 revenue decline narrowed, with respiratory drug demand expected to recover in Q4, potentially stabilizing revenue [2] - The company reported a 25 76% YoY decline in revenue to 6 365 billion yuan and a 68 46% YoY drop in net profit to 555 million yuan for the first three quarters of 2024 [2] - Q3 revenue was 1 761 billion yuan, down 1 3% YoY, with net profit falling 84 07% to 24 32 million yuan [2] - Gross margin decreased by 7 62 percentage points to 53 39%, while net margin dropped by 11 82 percentage points to 8 63% [2] - High prices of traditional Chinese medicine raw materials, such as Coptis, contributed to the margin decline [2] R&D and Innovation - Yiling Pharmaceutical's core competitiveness lies in its strong R&D capabilities, particularly in the field of collateral disease theory [3] - The company invested 572 million yuan in R&D in the first three quarters of 2024, with an R&D expense ratio of 8 99% [3] - Several new drugs, including Qifang Bitong Tablets and Chaihuang Lidan Capsules, have been accepted for new drug applications [3] - Seven drugs are currently in clinical stages, with two in Phase III clinical trials [3] - The company plans to submit 1-2 new drug applications annually, focusing on respiratory, endocrine, gastrointestinal, and pediatric fields [3] Financial Projections - Revenue for 2024-2026 is projected to be 8 841 billion yuan, 9 928 billion yuan, and 11 436 billion yuan, respectively, with YoY growth rates of -14 3%, 12 3%, and 15 2% [5] - Net profit attributable to shareholders is expected to be 870 million yuan, 1 111 billion yuan, and 1 364 billion yuan for 2024-2026 [5] - EPS is forecasted at 0 52 yuan, 0 67 yuan, and 0 82 yuan for the respective years [5] - The PE ratio is estimated at 32 45x, 25 40x, and 20 70x for 2024-2026 [5] Key Financial Metrics - Gross margin is expected to remain stable at around 55 7%-55 9% from 2024-2026 [6] - ROE is projected to recover from 7 4% in 2024 to 10 5% in 2026 [6] - The company's debt-to-asset ratio is forecasted to decrease from 32 6% in 2023 to 30 8% in 2026 [6]