Sinocare(300298) 华泰证券·2025-04-21 10:45Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of 29.64 RMB [7][8]. Core Views - The company achieved revenue and net profit of 4.443 billion RMB and 326 million RMB in 2024, representing year-on-year growth of 9.5% and 14.7% respectively, slightly above expectations [1]. - The company is expected to maintain a steady growth trajectory in 2025, driven by the robust development of its core BGM business and the positive growth of its CGM business [1][2]. Summary by Sections Financial Performance - In Q4 2024, the company reported revenue and net profit of 1.261 billion RMB and 71 million RMB, showing year-on-year growth of 23.2% and a return to profitability [1]. - The gross margin for 2024 was 54.9%, an increase of 1.3 percentage points year-on-year, attributed to product revenue structure optimization and ongoing cost reduction efforts [1]. Business Segments - The BGM business is projected to grow by 10-15% in 2024, with the company being the fourth largest blood glucose meter manufacturer globally and holding over 50% market share in China's retail market [2]. - The PTS segment is expected to achieve a net profit exceeding 1 million USD in 2024, with further improvements anticipated in 2025 [2]. - Trividia turned a profit in 2024 with a net profit of 75.35 million RMB, recovering from a net loss of approximately 9 million USD in 2023, and is expected to continue its profitable trajectory in 2025 [2]. CGM Market Outlook - The CGM segment is expected to see rapid growth in the domestic market in 2024, with projected sales of 400-600 million RMB in 2025 due to improved product recognition and the approval of the second-generation CGM [3]. - The company has established a strategic distribution agreement in the EU and anticipates CE certification for the second-generation CGM in the second half of 2025, which will facilitate market entry in key EU countries [3]. - The company has submitted an FDA registration application for its products in the US, with expectations for approval in the second half of 2025, which will contribute to revenue growth in overseas markets [3]. Profit Forecast and Valuation - The company is projected to achieve EPS of 0.78, 0.93, and 1.09 RMB for 2025, 2026, and 2027 respectively, with a compound annual growth rate (CAGR) of 24% for net profit from 2024 to 2026 [4]. - The company is valued at a 38x PE for 2025, compared to a 27x average for comparable companies, with a target price of 29.64 RMB [4].