LIVZON GROUP(SZ:000513) Huafu Securities·2024-10-27 09:42Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 20% relative to the market benchmark within the next six months [4][14]. Core Views - The company reported a revenue of 9.08 billion in the first three quarters of 2024, a decrease of 5.9% year-on-year, while the net profit attributable to the parent company was 1.67 billion, an increase of 4.4% year-on-year [1]. - The company has a rich pipeline of drugs under development, with several products expected to receive approval in the near future, which supports long-term growth potential [3]. Summary by Sections Financial Performance - For Q1-Q3 2024, the company achieved a revenue of 90.8 billion, down 5.9% year-on-year, and a net profit of 16.7 billion, up 4.4% year-on-year [1]. - In Q3 2024, the revenue was 28 billion, a decrease of 5.6% year-on-year, while the net profit was 5 billion, an increase of 7.5% year-on-year [1]. Business Segments - Chemical preparations revenue for Q1-Q3 2024 was 47.1 billion, down 8.5% year-on-year, with notable declines in gastrointestinal products and traditional Chinese medicine [2]. - Diagnostic reagents and equipment showed strong performance with a revenue increase of 21% year-on-year, reaching 5.7 billion [2]. Cost Management - The company successfully reduced its sales expense ratio to 25.6%, down 3 percentage points year-on-year, while the financial expense ratio increased to 0.8%, up 6.7 percentage points [3]. Research and Development - The company has made significant progress in its drug pipeline, with recent approvals for new indications and ongoing clinical trials for several products [3]. Profit Forecast - The profit forecast for the company has been adjusted, with expected net profits of 20.7 billion, 23 billion, and 25.3 billion for 2024, 2025, and 2026 respectively, reflecting year-on-year growth rates of 6%, 11%, and 10% [3].