SSSW(SH:688399) ZHESHANG SECURITIES·2024-10-27 08:23Investment Rating - The report assigns an "Accumulate" rating for the company [5] Core Views - The company is a leader in the molecular diagnostics field, with solid technical platforms and product pipelines, showing strong responsiveness to public health events. The disturbances from high bases and impairments have cleared in 2024, allowing the regular business to gradually return to normal, and the international strategic layout has begun to yield results, indicating significant growth potential [2][3] Summary by Sections Company Overview - The company focuses on the research, production, and sales of in vitro diagnostic reagents and related detection instruments, achieving an integrated operation model of "instruments + reagents + services" with over 600 products [13] Stock Price and Performance Review - Since 2020, the company's stock price surged over 650% due to the COVID-19 testing business. However, in 2023, the stock price fell sharply as the COVID-19 testing business declined. By October 21, 2024, the stock price had increased by over 35% in 2024 as disturbances cleared [3][14] Revenue and Profitability - From 2018 to 2023, the company's revenue CAGR was 11.8%. In 2024H1, excluding COVID-19 related impacts, the company's regular business revenue grew by 1.96% year-over-year, and net profit increased by 142.82% year-over-year, indicating a return to steady growth [3][16] Molecular Diagnostics Market - The global molecular diagnostics market grew from $7.1 billion in 2019 to $11.1 billion in 2023, with a CAGR of 11.8%. The Chinese market reached 22.4 billion RMB in 2023, with a CAGR of 27.8%, expected to grow to 27.7 billion RMB in 2024 [4][24] Competitive Landscape - The Chinese molecular diagnostics industry is fragmented, with foreign companies like Roche and Abbott leading, while domestic companies are rapidly emerging. The market is not yet monopolized, allowing for diverse competition [4][31] Technological Platforms - The company has five core technology platforms, including multiple fluorescence quantitative PCR, NGS, POCT, mass spectrometry, and automation control platforms, enabling a wide range of applications in infectious disease prevention, clinical testing, and tumor screening [6][34] International Expansion - The company has accelerated its international strategy, with overseas revenue growing by 34.41% in 2024H1. The company has obtained CE IVDR certification for nine products, indicating successful international market penetration [6][36] Profit Forecast and Valuation - The company is expected to achieve revenues of 4.1 billion, 4.8 billion, and 5.6 billion RMB from 2024 to 2026, with corresponding net profits of 0.6 billion, 0.9 billion, and 1.3 billion RMB, reflecting a recovery phase and growth potential [7][37]