中药行业周报：短期关注中报业绩，长期关注三大主线

Investment Rating - The report maintains an "Overweight" rating for the traditional Chinese medicine (TCM) industry [5]. Core Insights - The TCM sector has shown a relative performance decline of -2% over the past month, -8% over three months, and -4% over twelve months compared to the CSI 300 index [1]. - The TCM index rose by 1.62% last week, while the overall pharmaceutical sector increased by 3.21%, indicating a relatively strong performance in the pharmaceutical industry [2]. - The TCM sector's current PE (ttm) is 24.47X, with a PB (lf) of 2.17X, reflecting a valuation premium of 111.47% over the CSI 300 index [3]. Market Performance - The TCM index closed at 6079.77 points, with a weekly increase of 1.62% [2][9]. - The pharmaceutical sector's performance was bolstered by supportive policies for innovative drugs and expectations of overseas interest rate cuts [2]. Valuation Metrics - The TCM sector's PE (ttm) increased by 0.38X week-on-week, while the PB (lf) rose by 0.04X [3]. - The TCM sector's PE is at the 20.89% percentile and PB at the 3.33% percentile over the past decade [3]. Raw Material Market - The total price index for TCM raw materials decreased by 0.4% last week, indicating insufficient demand and a seasonal market slowdown [4]. Investment Recommendations - Short-term focus on interim report performances, with 4 companies having released their 2024 semi-annual reports, and 8 out of 14 companies reporting positive net profit growth [5]. - Long-term focus on three main lines: 1. "Drug" innovation, emphasizing TCM innovative drugs driven by policy and clinical needs [5][7]. 2. "Drug" rejuvenation, focusing on brand TCM with competitive advantages [7]. 3. State-owned enterprise reform, targeting efficiency improvements in state-controlled enterprises [7].