Shenzhen YHLO Biotech (688575) 国信证券·2024-11-07 05:48Investment Rating - Outperform rating with a target price range of 21.23-23.42 RMB, implying a 15.9-27.9% upside from the current price [1][3] Core Views - The company is a leading domestic brand in chemiluminescence, with a complete product portfolio covering high, medium, and low-end models and intelligent assembly lines [1] - The chemiluminescence business is the core growth driver, with revenue growing from 140 million RMB in 2018 to 1.17 billion RMB in 2023, a CAGR of over 50% [1] - The company has a strong presence in key areas such as autoimmune diseases, reproductive health, diabetes, infectious diseases, liver diseases, and cardiovascular diseases [1] - The company's strategy of "specialized entry, routine expansion" has been effective, with routine diagnostic reagent revenue growing 50.20% YoY in 2023 and 52.48% YoY in H1 2024 [1] - The company is expanding internationally, with overseas non-COVID business revenue growing rapidly, driven by partnerships such as with Japan's MBL [1] Industry Overview - The global in-vitro diagnostics (IVD) market is expected to reach 106.5 billion USD in 2023, with a CAGR of 3.8% from 2023-2028 [21] - The Chinese IVD market is expected to reach 120 billion RMB in 2023, with immunodiagnostics being the largest segment at 37.5 billion RMB, growing 13% YoY [21][23] - Chemiluminescence is the mainstream advanced technology in immunodiagnostics due to its high sensitivity, wide linear range, and rapid clinical application [23] - The domestic autoimmune diagnostics market is estimated at 1.5-2 billion RMB, with significant growth potential as autoimmune diseases become more recognized and treated [1][27] Company Performance and Strategy - The company's revenue grew from 722 million RMB in 2018 to 1.676 billion RMB in 2023, with a CAGR of 18.3% [17] - Non-COVID self-produced business revenue grew from 246 million RMB in 2018 to 1.326 billion RMB in 2023, a CAGR of 40.1% [17] - The company has a comprehensive product menu with 176 chemiluminescence diagnostic items, leading the industry in autoimmune diagnostics with 60 items [33] - The company has achieved wide coverage in high-grade hospitals, with over 35% of its total installations in Tier 3 and above hospitals [35] - The company is expanding its product line with new technologies such as multi-detection and microfluidics, and aims to increase self-produced raw material rate to over 80% in the next 3-5 years [38] Financial Projections - Revenue is projected to be 2.044 billion RMB in 2024, 2.502 billion RMB in 2025, and 3.078 billion RMB in 2026, with YoY growth rates of -0.5%, 22.4%, and 23.1% respectively [1] - Net profit is projected to be 381 million RMB in 2024, 513 million RMB in 2025, and 667 million RMB in 2026, with YoY growth rates of 7.4%, 34.5%, and 30.0% respectively [1] - EPS is projected to be 0.67 RMB in 2024, 0.90 RMB in 2025, and 1.17 RMB in 2026, with a current PE ratio of 27x, 20x, and 16x respectively [1]