Core Viewpoint - China Traditional Chinese Medicine (CTCM) is rated as neutral by CICC, with a target price of HKD 2.40, corresponding to P/E ratios of 34.5 and 16.3 for 2026 and 2027 respectively [1] Group 1: Policy Support - The Chinese government is increasingly supporting the development of the traditional Chinese medicine industry, as indicated by the policies released in January 2021 [2] - The "14th Five-Year Plan" is expected to further promote the development of traditional Chinese medicine, with the company having a solid layout in the industry chain [2] Group 2: Technological Innovation - The company is focusing on the development of innovative traditional Chinese medicine and the secondary development of proprietary Chinese medicines to enhance its internal potential [3] - The emphasis on R&D is expected to improve the company's academic competitiveness and strengthen its new product reserve capabilities [3] Group 3: Market Differentiation - While the market is concerned about profit declines due to centralized procurement, the company is actively enhancing its marketing reforms and evidence-based medical research, which could help control costs in the long term [4] - Potential catalysts include successful marketing reforms and breakthroughs in the development of new traditional Chinese medicines [4] Group 4: Profit Forecast and Valuation - The company’s EPS is projected to be -0.11, 0.06, and 0.13 for the years 2025 to 2027 [5] - The current stock price corresponds to P/E ratios of 31.0 and 14.7 for 2026 and 2027, respectively, with a neutral rating and a target price of HKD 2.40, indicating an upside potential of 11.1% [5]
中金：再次覆盖中国中药(00570)给予中性评级 目标价2.40港元