SIRIO(300791) 东吴证券·2024-07-01 23:00Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook for its stock performance in the coming months [59][227][260]. Core Insights - The company is a leading player in the health supplement CDMO sector, focusing on multi-formulation strategies to expand into overseas markets. It has a strong foundation in contract development and manufacturing for nutritional health products, with a history dating back to 1993 [59][227]. - The global health supplement market is vast, exceeding 2 trillion yuan, with China's market nearing 400 billion yuan, showing a compound annual growth rate (CAGR) of 6.9% from 2018 to 2023. The increasing health awareness among consumers is driving market expansion [59][227]. - The company has a robust R&D and production capability, with a focus on external acquisitions to support its globalization strategy. It has established five major R&D centers across China, the US, and Europe, enhancing its ability to respond quickly to customer needs [59][227]. Summary by Sections 1. Company Overview - The company transitioned from a pharmaceutical manufacturer to a health supplement CDMO in 2000, with significant acquisitions in 2016 and 2023 to enhance its international presence [59][227]. - The ownership structure is stable, with key executives having extensive experience in the pharmaceutical industry, which contributes to the company's confidence and strategic direction [59][227]. 2. Market Dynamics - The health supplement market is characterized by a fragmented landscape, with a growing trend towards functional foods driven by increased consumer health consciousness and demographic changes [59][227]. - The report highlights the potential for contract manufacturing firms to thrive in this environment, as they can efficiently support a diverse range of brands entering the market [59][227]. 3. Financial Performance and Projections - The company achieved a revenue of 3.58 billion yuan in 2023, with a projected growth to 4.35 billion yuan in 2024, reflecting a 21% year-on-year increase. The net profit is expected to grow significantly, indicating strong operational performance [61][227]. - The earnings per share (EPS) are projected to increase from 1.19 yuan in 2023 to 1.70 yuan in 2024, with a corresponding price-to-earnings (P/E) ratio of 14.80 [61][227]. 4. R&D and Production Capabilities - The company has a leading position in obtaining regulatory approvals, with a total of 352 certificates, including 115 registrations and 237 filings, showcasing its strong R&D capabilities [177][206]. - The production capacity is diversified across various product forms, including soft capsules, gummies, and functional beverages, which are increasingly popular among consumers [59][227]. 5. Strategic Acquisitions and Global Expansion - The acquisition of Best Formulations in 2023 is expected to enhance the company's market share in North America, with a focus on integrating operations and leveraging synergies [59][227]. - The company is also expanding its footprint in Europe, with a dedicated sales team and a strategy to tap into emerging markets [59][227].