TC Medical(SH:600763) Guotai Junan Securities·2024-08-27 05:58Investment Rating - The investment rating for the company is maintained at "Buy" [5][11]. Core Insights - The company is experiencing a slowdown in growth due to external environmental factors, with a strategy of exchanging price for volume in the dental implant sector. The consumer dental segment is under short-term pressure, while the development of the Pugongying branches is progressing smoothly [4]. - The company achieved a revenue of 1.411 billion yuan in H1 2024, representing a growth of 3.52%, and a net profit attributable to shareholders of 310 million yuan, up by 1.77% [11]. - The target price has been adjusted to 48.80 yuan, down from the previous forecast of 52.56 yuan, based on a PE ratio of 40x for 2024 [11]. Financial Performance - For H1 2024, the company reported a gross margin of 40.83% and a net margin of 26.06%, indicating stable profitability despite increased investments and changing customer pricing [11]. - The dental implant revenue reached 255 million yuan, up by 11.3%, with the number of implants sold increasing by 41% [11]. - The company operates 84 medical institutions, with 63 located in Zhejiang province, contributing 12.85 billion yuan in revenue, which accounts for 91% of total revenue [11]. Business Segments - The dental implant segment is expected to continue growing in the second half of the year, driven by the implementation of centralized procurement policies [11]. - The Pugongying branches have shown rapid growth, contributing 3.25 billion yuan in revenue and 39.54 million yuan in net profit in H1 2024, with a gross margin of 30% [11]. - The orthodontics segment reported a revenue decline of 4.7%, while pediatric services saw a slight decrease of 1.1% [11].