Core Viewpoint - The listing process of Jiangxi Shimei Pharmaceutical Co., Ltd. has attracted significant attention, particularly regarding its business focus and financial performance, as it primarily generates revenue from generic drugs while its innovative drugs are still in the research phase [1][2][3]. Business and Industry Situation - Jiangxi Shimei Pharmaceutical, established in November 2002, focuses on the research, development, production, and sales of generic drugs, improved innovative drugs, and innovative drugs, while also providing comprehensive services such as technology transfer and contract development and manufacturing (CDMO) [2][3]. - The company plans to raise 608 million yuan for projects related to the development and industrialization of chiral antihypertensive drugs, innovative drug research in Shandong, and the establishment of a formulation production base [2]. Performance Trends - The company reported significant revenue growth during the reporting period, with revenues of 81 million yuan, 148 million yuan, 184 million yuan, and 192 million yuan from 2020 to 2023, reflecting year-on-year growth rates of 81.72% and 24.53% in 2021 and 2022, respectively [4]. - Net profits also increased substantially, with figures of 19.31 million yuan, 51.54 million yuan, 75.58 million yuan, and 99.58 million yuan, showing year-on-year growth of 166.89% and 46.66% in 2021 and 2022, respectively [4]. Comparison with Peers - While Jiangxi Shimei Pharmaceutical's performance has improved, some of its peers, such as Boji Pharmaceutical and Baihua Pharmaceutical, have experienced declines in net profit, raising regulatory concerns about the reasons behind these contrasting trends [5]. - The company attributes its growth to favorable industry policies, strong market demand, and successful project registrations with large pharmaceutical enterprises, which have positively impacted its revenue [5]. Gross Margin Analysis - The gross margin of Jiangxi Shimei Pharmaceutical has consistently exceeded industry averages, with figures of 80.22%, 81.79%, 83.63%, and 88.28% during the reporting period [6]. - The gross margin for its pharmaceutical research and CDMO business was reported at 67.38%, 81.60%, 90.58%, and 91.84%, significantly higher than the average gross margins of comparable companies [6][7]. - The company’s gross margin is also notably higher than leading CRO firms like WuXi AppTec, which reported gross margins of 37.97% to 40.52% during the same period, indicating a strong competitive position [7].

Core Viewpoint - The company is transforming its development momentum through the "Three New and Two Transformations" strategy, focusing on digital transformation, new retail, and new medical services to become the most professional health service provider in China and achieve its goal of becoming a century-old enterprise [1][7]. Digital Empowerment - The company has evolved from a grassroots pharmaceutical wholesaler to a technology-driven comprehensive service provider in the pharmaceutical industry, with a clear strategic path and implementation results in its digital transformation [1][2]. - The digital transformation includes collaboration across business, management, and logistics, with a focus on reducing costs and increasing efficiency [2][3]. - The company has achieved a significant reduction in logistics errors, with an error rate controlled at one in a million, enhancing both efficiency and quality [2]. Strategic Focus - The "Three New" strategy addresses the long-standing "two disconnections" in the industry by enhancing control over upstream products and establishing a new retail network for downstream channels [2][5]. - The company aims for new product-related sales to account for 20% of total revenue and 50% of gross profit in the next three years [3][5]. Medical Aesthetics Business - The company is accelerating its layout in the medical aesthetics sector, which has shown rapid growth, increasing from several million to several billion in scale [5][6]. - The medical aesthetics market is seen as a key profit growth point, driven by the aging population and rising consumer demand for beauty services [5][6]. Talent Strategy - The company has shifted its talent acquisition strategy, significantly increasing the recruitment of external senior talent to meet the demands of its strategic transformation [6][7]. - In 2023, the company introduced a "Three Transformations Talent Strategy," aiming to recruit over 300 senior talents annually [6]. Financial Performance - The company's sales revenue has grown from 21.185 billion in 2010 to 151.81 billion in 2024, with a compound annual growth rate of 15.10% [6]. - The net profit attributable to the parent company increased from 360 million in 2010 to 2.507 billion in 2024, with a compound annual growth rate of 14.88% [6].