TAIJI GROUP(SH:600129) SINOLINK SECURITIES·2024-10-25 11:02Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [10][11]. Core Views - The company reported a revenue of 10.43 billion RMB for the first three quarters of 2024, a decrease of 14.36% year-on-year, with a net profit attributable to shareholders of 545 million RMB, down 28.1% [2][3]. - The decline in revenue is attributed to high base effects from the previous year, particularly in the pharmaceutical industrial sector, which saw a revenue drop of 25.2% [2][3]. - Despite the short-term challenges, the company is expected to achieve good growth in the future, supported by the continued growth of key products [3]. Summary by Sections Performance Review - For Q3 2024, the company achieved a revenue of 2.617 billion RMB, down 16.44% year-on-year, and a net profit of 50 million RMB, down 73.8% [2]. - The pharmaceutical industrial revenue was approximately 6.19 billion RMB, while the pharmaceutical commercial revenue was about 5.11 billion RMB [2]. Operational Analysis - The company optimized its marketing system, resulting in a significant decrease in sales expense ratio, which was 27.63% for the first three quarters of 2024, down 6.54 percentage points year-on-year [2]. - Key products like the emergency syrup and nasal sinus liquid continued to see sales growth, despite declines in other areas [3]. Profit Forecast and Valuation - The revenue forecasts for 2024-2026 have been revised down to 13.237 billion RMB, 15.097 billion RMB, and 16.641 billion RMB, respectively, with expected year-on-year growth rates of -15%, 14%, and 10% [3]. - The net profit forecasts for the same period have also been adjusted to 617 million RMB, 848 million RMB, and 1.007 billion RMB, with expected growth rates of -25%, 37%, and 19% [3]. - The current price-to-earnings ratio is projected to be 23, 17, and 14 times for 2024, 2025, and 2026, respectively [3].