Sinocare(SZ:300298) SINOLINK SECURITIES·2025-04-29 01:34Investment Rating - The report maintains a "Buy" rating for the company, expecting significant growth in the coming years [5][12]. Core Insights - The company reported a revenue of 1.042 billion RMB in Q1 2025, showing a year-on-year increase of 2.76%, while the net profit attributable to the parent company was 72.12 million RMB, a decrease of 10.90% year-on-year [3]. - The increase in sales expenses, which rose by 19.57% year-on-year to 289 million RMB, is aimed at promoting the new Continuous Glucose Monitoring (CGM) products domestically and internationally, indicating a focus on innovation and market expansion despite short-term profit pressures [3]. - The second-generation CGM product has been approved, featuring improvements in design and user experience, which is expected to enhance market competitiveness [3]. - A distribution agreement has been signed with A. MENARINI DIAGNOSTICS S.r.l. for exclusive distribution of the CGM systems in over 20 European countries, indicating potential for rapid sales growth in overseas markets [4]. Financial Projections - The projected net profits for the company from 2025 to 2027 are 476 million RMB, 567 million RMB, and 691 million RMB, representing year-on-year growth rates of 46%, 19%, and 22% respectively [5]. - The expected price-to-earnings (P/E) ratios for the years 2025, 2026, and 2027 are 26, 22, and 18 times, respectively, suggesting a favorable valuation outlook [5]. Company Overview - The company’s revenue is projected to grow from 4.059 billion RMB in 2023 to 6.960 billion RMB in 2027, with a compound annual growth rate (CAGR) of approximately 17.69% [10]. - The net profit is expected to recover from a decline in 2023 to 691 million RMB by 2027, reflecting a strong recovery trajectory [10].