Yifeng Pharmary(SH:603939) Soochow Securities·2024-09-03 12:00Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company achieved a revenue of 11.762 billion yuan in H1 2024, representing a year-on-year increase of 9.86%, and a net profit attributable to shareholders of 798 million yuan, up 13.13% year-on-year [3] - The company continues to deepen its regional market presence through a strategy of "new openings + acquisitions + franchising," resulting in a total of 14,736 stores by H1 2024, with 1,575 new stores added since the beginning of the year [3] - The O2O business has shown remarkable growth, with online revenue reaching 1.096 billion yuan in H1 2024, a 20.18% increase, and O2O revenue specifically growing by 26.33% to 878 million yuan [3] Financial Performance Summary - Total revenue (in million yuan) for the years 2022A to 2026E is projected to grow from 19,886 to 33,042, with a CAGR of approximately 14.46% [2] - Net profit attributable to shareholders (in million yuan) is expected to rise from 1,262 in 2022A to 2,319 in 2026E, reflecting a growth rate of 19.59% [2] - The latest diluted EPS is projected to increase from 1.04 in 2022A to 1.91 in 2026E, indicating a strong upward trend in earnings per share [2] Business Segment Overview - Retail business revenue in H1 2024 was 10.398 billion yuan, up 8.32%, while wholesale business revenue reached 999 million yuan, a significant increase of 20.85% [3] - The gross margin for retail business was 40.94%, showing a slight increase, while the wholesale business gross margin was 9.57%, reflecting a decrease of 0.61 percentage points [3] - Revenue from traditional Chinese and Western medicine reached 8.878 billion yuan, with a gross margin of 34.85%, while non-pharmaceutical products generated 1.353 billion yuan with a gross margin of 51.10% [3] Store Expansion and Market Strategy - The company has expanded its store network significantly, with 1,135 new direct stores and 440 new franchise stores added in H1 2024 [3] - The company is focusing on consolidating its presence in the Central South, East China, and North China regions, with notable new store openings in these areas [3] - The O2O strategy is being enhanced through the integration of membership, big data, and online healthcare services, with over 10,000 stores now part of the O2O multi-channel platform [3]