中药行业周报：中医药积极参与重症医学医疗服务能力建设，优势有望进一步发挥

Investment Rating - The report maintains an "Overweight" rating for the traditional Chinese medicine (TCM) industry [8]. Core Viewpoints - The TCM industry is expected to benefit from digitalization, which is anticipated to create new momentum for development [6]. - The performance of the TCM industry in 2023 and Q1 2024 has been overall positive, with a notable recovery in the pharmaceutical sector [3][4]. - The TCM sector is experiencing structural differentiation, with companies aligning with policy trends likely to perform better [7]. Summary by Sections Market Performance - The TCM index closed at 7176.51 points, up 0.8% last week, while the overall pharmaceutical sector rose by 2.61% [3][10]. - Year-to-date, the pharmaceutical sector has seen a cumulative decline of 7.43%, with only the TCM and pharmaceutical commercial sectors recording positive returns [3]. Valuation Metrics - The TCM sector's Price-to-Earnings (PE) ratio is 28.9X, up 1.13X from the previous week, with a Price-to-Book (PB) ratio of 2.54X, reflecting a slight increase [4]. - The TCM sector's PE is at the 33.2 percentile and PB at the 10.2 percentile over the past decade, indicating a relative valuation premium of 136.73% compared to the CSI 300 index [4]. Market Trends - The TCM raw material market is relatively stable, with a total price index of 257.39 points, showing little change week-on-week [5]. - Among the twelve categories of TCM materials, eight saw price increases while four experienced declines, indicating a mixed market trend [5]. Policy and Innovation - Recent government policies emphasize the enhancement of critical care medical services, with TCM expected to play a significant role in this area [6]. - The report highlights two main investment themes: TCM innovation driven by policy and clinical needs, and new consumption opportunities under the "TCM+" perspective [8]. Investment Strategy - Investors are encouraged to focus on companies with strong R&D capabilities and those that align with the latest policy changes, particularly in the context of new drug approvals and market expansions [8].