INTCO MEDICAL(300677) 华西证券·2024-08-15 13:03Investment Rating - The report assigns a "Buy" rating for the company, with a target price of 25.94 CNY per share [1][3]. Core Insights - The report indicates that the disposable glove industry is at a turning point after experiencing inventory destocking and overcapacity, with multiple factors suggesting a recovery in supply-demand balance [1][3]. - The company, Yingke Medical, has a significant production capacity of 79 billion gloves, ranking second globally, and is expected to benefit from cost, capacity, and financial advantages [1][3][11]. - The report highlights that Chinese manufacturers have gained market share due to advantages in energy costs, production efficiency, and supply chain support compared to Malaysian competitors [1][3][11]. Summary by Sections Company Overview - Yingke Medical was established in 2009 and has rapidly expanded its disposable glove production capacity from 36 billion in 2020 to 79 billion by the end of 2023 [11]. - The company has five major production bases in China and exports to over 120 countries and regions [11]. Industry Analysis - The disposable glove market has seen a surge in demand due to the pandemic, followed by a phase of destocking and overcapacity, with signs indicating that the turning point has been reached [1][18]. - The report notes that nitrile gloves are expected to become the mainstream product in the disposable glove market, with their market share projected to increase from 35.2% to 37.1% by 2025 [21]. Financial Performance and Forecast - The company reported a revenue of 6.919 billion CNY in 2023, with a projected revenue of 9.099 billion CNY for 2024, reflecting a year-on-year growth of 31.5% [5][3]. - The forecast for net profit for 2024 is 1.283 billion CNY, with an expected EPS of 1.98 CNY, indicating a significant recovery from previous years [5][3]. Competitive Advantages - The company has a robust financial position, with cash and tradable financial assets amounting to 151.38 million CNY as of Q1 2024, allowing it to navigate potential tariff impacts effectively [2][3]. - Yingke Medical's cost control measures, including upstream integration and energy self-supply, are expected to enhance its competitive edge [1][3][2].