SINOPHARM(01099) 第一上海证券·2024-12-05 07:45Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 26.82, indicating a potential upside of 28.0% from the current price of HKD 20.95 [5][6]. Core Insights - The company's revenue for the first three quarters of 2024 reached CNY 442.42 billion, a year-on-year decrease of 0.78%. The overall gross margin declined by 0.68 percentage points to 7.55%, and the net profit attributable to shareholders was CNY 5.279 billion, down 13.41% year-on-year [2]. - In Q3, the company experienced a revenue growth of 1.88% year-on-year, primarily due to a low base effect from the previous year, with a quarter-on-quarter growth of only 0.16%. The net profit for Q3 was CNY 1.575 billion, reflecting a year-on-year decrease of 20.94% [2]. Summary by Sections Pharmaceutical Distribution - The pharmaceutical distribution business showed a stable growth of 0.47% in the first half of the year. The company focused on key regions such as Jiangsu, Zhejiang, Shanghai, Central China, North China, and Guangxi, where revenue share has been increasing, leading to a growing market share. The direct sales to medical institutions slightly decreased, but retail direct sales increased due to the company's channel advantages [3]. Medical Device Distribution and Retail - The medical device distribution business faced significant pressure, with a revenue decline of 7.08% in the first half of the year. Although the distribution of medical consumables remained relatively stable, revenues from high-margin products like medical equipment and IVD test reagents decreased, impacting the overall gross margin [4]. - The retail business also suffered from a reduction in individual medical accounts and intensified competition, leading to a 6.43% year-on-year decline in retail revenue to CNY 16.6 billion. The company took measures such as closing loss-making stores, resulting in a narrowed loss for its retail subsidiary in Q3 [4]. Financial Metrics - The company has a total share capital of 3.121 billion shares and a market capitalization of HKD 64.75 billion. The stock has a 52-week high of HKD 23.65 and a low of HKD 16.02, with a net asset value per share of HKD 27.46 [5].