Investment Rating - The investment rating for the company is "Buy" with a target price of 5.98 HKD per share, compared to the current price of 3.52 HKD [2][12]. Core Insights - The company reported a slight decline in revenue for the first half of 2024, with a year-on-year decrease of 2.7% to 4.98 billion RMB, primarily due to the impact of two years of medical insurance settlement differences and a high base from the first half of 2023. However, net profit attributable to shareholders increased by 9.1% to 434 million RMB [6][12]. - The hospital business revenue also saw a slight decline, with outpatient and inpatient visits increasing, but average revenue per visit decreased. The medical business revenue for the hospitals was 4.60 billion RMB, down 3.0% year-on-year. Excluding the impact of medical insurance settlement differences and the closure of Huaiyin Hospital, revenue remained stable [6][12]. - The company is expected to continue its cost reduction and efficiency improvement strategies, which are anticipated to mitigate the impact of medical insurance settlement differences. For 2024, the company forecasts a stable growth in internal performance, with net profit expected to increase by 8.6% compared to the adjusted figure from 2023 [6][12]. Summary by Sections Financial Performance - For the first half of 2024, the company achieved an EBITDA of 970 million RMB, remaining stable year-on-year. The proportion of drug and consumable costs in revenue decreased by 0.6 percentage points, helping to offset the impact of medical insurance settlement differences [6][12]. - The forecast for 2024 indicates a slight decline in hospital business revenue, with expectations of a 4-5% growth in 2025-2026 as the impact of medical insurance settlement differences diminishes [12][13]. Hospital Operations - The company operates a total of 127 medical institutions, including 13 tertiary hospitals and 23 secondary hospitals, with a total of 20,845 operational beds as of June 30, 2024. The company is focusing on enhancing the quality and efficiency of its operations through centralized procurement and digitalization [6][12]. - The outpatient revenue was 1.81 billion RMB, up 1.4% year-on-year, while inpatient revenue was 2.70 billion RMB, down 6.1%. The average revenue per outpatient visit decreased by 2.0%, and for inpatient visits, it decreased by 8.8% [6][12]. Profitability and Valuation - The company is expected to maintain a profit margin improvement trend, with net profit projected to grow by approximately 7% in 2025-2026. The reference valuation based on comparable companies suggests a PE ratio of 10 times for 2024, leading to a reasonable value of 5.98 HKD per share [12][13].
华润医疗：收入略降，利润贡献趋于提升