KPC(SH:600422) Xinda Securities·2024-03-22 16:00Investment Rating - The report maintains an "Accumulate" rating for the company, consistent with the previous rating [8]. Core Views - The company achieved a revenue of 7.703 billion RMB in 2023, a year-on-year decrease of 6.99%. However, the net profit attributable to shareholders increased by 16.05% to 445 million RMB, and the net profit excluding non-recurring items rose by 33.45% to 335 million RMB. The operating cash flow also saw a significant increase of 40.25% to 356 million RMB [8]. - The growth in net profit is attributed to continuous optimization of the product structure and cost reduction measures. In Q4 2023, the company reported a revenue of 2.092 billion RMB, a slight increase of 0.14% year-on-year, with a remarkable net profit growth of 458.75% to 58 million RMB [8]. - The company is focusing on new drug research and development, with 29 new patent authorizations in 2023. It aims to enhance its core product pipeline and has made progress in clinical trials for innovative drugs [8]. - The company plans to concentrate on the elderly health sector in 2024, with three major business divisions targeting chronic disease management and traditional Chinese medicine [8]. Financial Summary - The company forecasts revenues of 8.180 billion RMB, 8.672 billion RMB, and 9.122 billion RMB for 2024, 2025, and 2026, respectively. The net profit attributable to shareholders is expected to be 561 million RMB, 686 million RMB, and 812 million RMB for the same years [9]. - The gross profit margin is projected to improve from 44.8% in 2023 to 53.4% by 2026, while the return on equity (ROE) is expected to rise from 8.4% to 11.9% over the same period [9]. - The earnings per share (EPS) is anticipated to increase from 0.59 RMB in 2023 to 1.07 RMB by 2026, reflecting a positive growth trajectory [9].