Investment Highlights - The company, China Traditional Chinese Medicine (00570), is given a neutral rating 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] - There is increasing policy support for the development of the traditional Chinese medicine industry, with the State Council issuing measures to accelerate its growth, which is expected to enhance the traditional Chinese medicine service system [1] - The company has a solid layout in the traditional Chinese medicine industry chain, currently undergoing a restructuring phase, focusing on core products like traditional Chinese medicine formula granules and expanding into various segments [1] Business Strategy - The company is actively engaged in marketing reforms and business restructuring to adapt to policy impacts such as centralized procurement, aiming for collaborative development across different segments [1][2] - The company is enhancing its technological innovation system to address industry challenges, focusing on the development of innovative traditional Chinese medicines and secondary development of existing products [1] Market Outlook - The market is concerned about potential profit declines due to centralized procurement; however, the company is optimistic about controlling expense ratios through marketing reforms and evidence-based medical research [2] - The company forecasts EPS of -0.11, 0.06, and 0.13 for 2025 to 2027, with current stock price corresponding to P/E ratios of 31.0 and 14.7 for 2026 and 2027, indicating an 11.1% upside potential [2]
中国中药(00570.HK)：国药集团入主加强产业和科技赋能 积极布局中药产业链