Fangsheng Pharmaceutical(SH:603998) Hua Yuan Zheng Quan·2025-09-03 14:31Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The company's performance in H1 2025 met expectations, driven by innovative traditional Chinese medicine, which is expected to support long-term growth [5] - The company reported a revenue of 834 million yuan in H1 2025, a year-on-year decline of 8.35%, while the net profit attributable to shareholders was 169 million yuan, a year-on-year increase of 23.67% [8] - The company is focusing on its pharmaceutical industrial sector, with a revenue of 768 million yuan from this segment, down 8.2% year-on-year [8] - Innovative traditional Chinese medicine is becoming a new profit growth point, with three innovative traditional Chinese medicine products approved [8] - The company is increasing its R&D investment, with R&D expenses reaching 68.09 million yuan in H1 2025, a year-on-year increase of 10.98% [8] Financial Summary - Revenue projections for the company are as follows: 1,629 million yuan in 2023, 1,777 million yuan in 2024, 1,749 million yuan in 2025E, 1,890 million yuan in 2026E, and 2,124 million yuan in 2027E [6] - The net profit attributable to shareholders is projected to be 187 million yuan in 2023, 255 million yuan in 2024, 342 million yuan in 2025E, 394 million yuan in 2026E, and 455 million yuan in 2027E [6] - The company’s earnings per share (EPS) is expected to grow from 0.43 yuan in 2023 to 1.04 yuan in 2027 [6] - The projected price-to-earnings (P/E) ratios are 26.72 for 2023, 19.56 for 2024, 14.58 for 2025E, 12.68 for 2026E, and 10.98 for 2027E [6]