Pharmaceutical dealers develop fast 5 shares are expected to benefit most

Oriental Securities December 20 issued a research report said that the rapid development of pharmaceutical and electronic business, good consumer medicine enterprises.

The research newspaper believes that the medical and electronic business will develop rapidly, the pharmaceutical electrical business or experienced two-stage development. From overseas experience, medicine is not perfect for electric dealers, however, the domestic electrical business industry has just started, the electric business enterprises in recent years, the future will be on the low base to achieve rapid growth. The study said first-line OTC and health-care products will push the first wave of development for pharmaceutical dealers, as prescription drugs are liberalized on E-commerce platforms and Medicare supports some online pharmacies, prescription drugs and Medicare reimbursement will drive the second wave of e-commerce development. and into the development of the late, online pharmacies will be merged with the physical pharmacy, to achieve the perfect combination of mailing and self-mentioning drugs.

OTC, health care products are the mainstream of online pharmaceutical products. Now because prescription drugs have not been released online pharmacies, pharmaceutical electronic commerce consumer products mainly in the OTC, health products, household medical equipment, pharmaceutical makeup, family planning products, etc., the day Cat Medicine Hall in the top of the drug is the treatment of infertility, bushen, tonic class and vitamins and other OTC products, and amend the five Zi Yan Zong pill, Tang Ren Tong (600085, shares bar) Liuwei Dihuang pill and Donga donkey-hide gelatin (000423, stock bar) 250g installed in the pharmaceutical unit, respectively, the top three monthly sales.

Electronic business or into consumption characteristics of traditional Chinese medicine enterprises important marketing methods. including Donga gelatin, Mayinglong (600993, Stock bar), Xinhuang (600436, Stock bar), Yunnan white powder (000538, shares bar), Tongren Temple, Cambe (600572, shares bar), Sig Pharmaceutical (600518, Stock bar), Guizhou Lark (002424, shares bar) such as the consumption characteristics of Chinese medicine listed companies in Taobao or Cat has an independent e-commerce platform. For Chinese herbal enterprises with consumption characteristics, although the pharmaceutical electrical business is a new form, but as a traditional direct marketing and dealer model outside an important supplement, the research report that its status will be tightened with the policy of deregulation and gradually upgrade to become the main marketing model, and to a certain extent, may enhance the profitability of the company.

Large enterprises with dominant core breeds benefit. Into the day Cat Mall enterprises need to pay security, also need to extract a certain commission, starting next year, if not up to the scheduled sales revenue scale may be forfeited margin, at present, may still be in half the status of Commission, so the future of the cat shopping mall start-up costs will be relatively high, more conducive to large enterprises. Research reports that although the electric business is a new platform, the current barriers to entry are not high, through a variety of marketing means to quickly increase the scale, but the medium and long term competitiveness of the product is still the core, so good to enter the electric business platform has the core advantages of varieties of enterprises.

Investment Strategies and Recommendations:

At present, analysts are optimistic about the operation of the electric business platform, with the core varieties of large consumer Chinese Medicine enterprises Dong Gelatin (000423, overweight), Yunnan white powder (000538, Buy), Mayinglong (600993, Buy), Xinhuang (600436, overweight), Cambe (600572, overweight). More companies are expected to benefit from the policy liberalisation of pharmaceuticals or the second stage of development.

(Securities Times News Center)

Donga gelatin

The company's Shandong Donga Donkey-gelatin health Management Chain Co., Ltd. specializes in operating E-commerce platform, the official website product sales, and in June 2012 in the days of the Cat Medical Museum set up the flagship store Donga donkey-hide-glue, open shop after the cumulative sales revenue of 8 million yuan, equivalent to the company's best direct sales of the and double 11 The day sales income nearly 4 million yuan.

At present, the products include 375g gift donkey-hide gelatin, 62.5g and 250g iron boxed donkey-hide gelatin block, 10g*12 bag and 10g*24 bag Donga, 300g and 450g (sugar, sugar-free) filling Peach Quiat Gel, 20ml*12 (sugar, sugar-free) branch, 20ml* 48 and 250ml compound donkey-hide gelatin paste, 20ml*10 branch and 20ml*30-gelatin black chicken oral liquid, 360g loaded with instant donkey-hide gelatin jujube, 70g*6 bottle donkey-Hide gelatin paste and many other products. In-store promotional activities, including the purchase of donkey-hide gelatin block 250g to make a piece of plastic accessories, 12 bagged gelatin and 300g peach Quiat plastic paste price reduction.

The company operates a flagship store on the day cat mainly divided into three, including third-party operating costs, advertising for the promotion and payment to Taobao Commission. The company takes the third party logistics to carry on the distribution, the main cooperation party is the EMS or the downwind and so on large-scale logistics distribution business, according to the different weight carries on the charge for the goods. Because the online price and physical store retail prices may exist spreads, so in order to avoid the future of the goods may be the electronic commerce to provide specialized products, such as donkey-hide-gelatin 62.5g iron boxed, it may become a network-specific products.

The paper speculates that the company may weaken traditional OTC channels in the future, strengthen direct shop and network sales at both ends of the sale, with the gradual digestion of inventory, donkey-hide gelatin traditional sales season, with Double one, double 12, etc. have been completed or are planning a variety of online promotional activities, the future of the electric business is expected to become an important part of the company's sales revenue.

Donkey-Hide gelatin block after the end of the sale of rapid growth. The company's first-half sales revenue of 1.149 billion, down only 0.1% per cent year-on-year, excluding sales of pharmaceutical companies last year after the impact of business income growth of 13.82% from a year earlier. The company September after the control of gelatin block, sales growth significantly, the main product for the donkey-hide-gelatin series of the parent company three quarterly income growth of 41.67%, donkey-hide gelatin block terminal sales still maintain about 30% growth, is expected to enter the four-month-donkey-hide-gelatin sales season, the donkey-hide Short-term donkey-hide the possibility of raising prices is very small, so the channel again store the power of goods is not strong.

The national record of compound donkey-hide gelatin pulp is still in progress. At present, the price of compound donkey-hide gelatin pulp nationwide has been largely completed and is expected to be completed next year. Donkey-Hide gelatin paste sales still maintain a high rate of growth, is expected to grow at more than 30%, waiting for the price to be completed, sales are expected to speed up. The company increased the promotion of peach Huaji, for customers taste constantly adjust the formula, is expected to launch a smaller packaging, easy to carry, the future is mainly located in white-collar.

The company estimated 2012-2014 earnings per share of 1.52, 1.90, 2.36 yuan, reference can be compared to the company valuation, to give 2012 32 times times PE valuation, corresponding to the target price of 48.64 yuan, to maintain the company's overweight rating.

Risk hint: Raw material price rises, channel flees goods.

(Securities Times News Center)

Sliced Aberdeen Xinhuang

Xinhuang recently announced the investment of 9.8 million yuan, the establishment of a wholly-owned subsidiary of Fujian Aberdeen Xinhuang Electronic Commerce Co., Ltd. to adapt to the new business environment, broaden the Xinhuang brand promotion and product sales channels, the main business of the website of health food and cosmetics.

Joint China Resources Group, product integration is worth looking forward to. The research report continues to be optimistic about the cooperation between the company and China Resources prior to the company and CRC set up a joint venture, injected into the four general drug products and four tablets Xinhuang series products, China Resources pledged three years sales of 200 million, as the return of resources in the realization of the above objectives can be obtained two years exclusive right to negotiate. Research newspaper that on the one hand, the company can borrow power resources powerful channel strength to make up for their own marketing short board to do a strong product to achieve profits, on the other hand, based on Huarun 39 (000999, shares bar) and Donga-gelatin before the success, or some tender offer may add to the future prospects of the

Daily pharmaceutical makeup Business is poised to be issued, open up a new way of profit. At the end of 2011, the company's Xinhuang deep-culture series of toothpaste officially on the market, the rigid demand for toothpaste, the trend of consumer demand escalation (Treasury) and brand promotion of continuous induction makes high-end functional Chinese toothpaste This segment of the industry to achieve rapid growth. Research report that, the film Aberdeen Xinhuang Deep-growing toothpaste to borrow the xinhuang of the brand effect supplemented by efficacy promotion is expected to achieve rapid growth of the company's new profit point.

Risk tip: The rate of increase in prices is less than expected;

(Securities Times News Center)

Mayinglong

The growth of hemorrhoid-treated products has slowed down. The first half of the company to achieve operating income of 781 million, of which treatment of hemorrhoids products 287 million, with

than the growth of 16.03%, other non-hemorrhoids drugs 82 million, year-on-year growth of 24.55%, drug retail wholesale 376 million, year-on-year growth of 8.02, hospital diagnosis and treatment 28 million, year-on-year growth of 125.34%. Comprehensive gross profit margin up nearly 1% year-on-year, the main is not treated hemorrhoids drugs gross profit margin rose more, to 13.05%.

Period of increase in cost rate, cash flow in good condition. The first half of the company's cost rate of 25.6%, an increase of 4.3%, mainly sales cost rate growth of more than 3.5%, the increase in financial costs is mainly the current period of loan interest rate rise. Operating activities generated a net cash flow of 58 million, an increase of 348.1%.

Hospital diagnosis and treatment business year-on-year growth, pharmaceutical makeup business is expected to become a new growth point. At present, the company has five anorectal hospitals, of which Wuhan, Beijing, Xian has realized profitability, Shenyang and Nanjing Hospital is still in loss, is expected to set up in 2012 1-2 Anorectal Hospital, next year is expected to transfer to the rapid expansion phase, diagnosis and treatment business is still the bright spot of future development. The company formed a Mayinglong eight biological, responsible for the "pupil Words" series, such as pharmaceutical products operation. "Pupil Words" four series 22 varieties have been developed and marketed, Mayinglong eight baby buttocks cream is also coming on the market, eight group value mining progress smoothly.

The company estimated 2012-2014 earnings per share of 0.60, 0.73, 0.89 yuan, taking into account the company's hospital business and pharmaceutical makeup business possible growth, reference can be compared to the company valuation, give 2012 30 times times PE valuation, corresponding to the target price of 18.00 yuan, maintain the company buy rating.

Risk tip: anorectal Hospital and drug makeup development rate is lower than expected.

(Securities Times News Center)

Yunnan White Powder

The company's third-quarter revenue growth accelerated, gross margin promotion. The company's first three-quarter income growth of 23.23%, gross profit margin of 30.2%, of which, the third quarter of growth accelerated to 29.9%, the chain Rose 5%, gross margin of 33.1%, the chain Rose 4%, the increase reached 15%. The acceleration of income growth is mainly due to the acceleration of toothpaste, aerosol growth, the first three quarters of white powder toothpaste sales of about 1.2 billion yuan, growth of more than 40%, is expected to be more than 1.6 billion yuan in 2012; aerosol growth of around 30%, is expected to be the annual aerosol will hopefully exceed 1 billion (including tax) Gross profit margin is mainly due to high gross margin products such as toothpaste, aerosol, such as the rapid growth of industrial income accounted for the rise.

Sales costs have risen markedly. The third quarter of the company's sales cost of 576 million yuan, the chain two quarter increase of 256 million yuan, the chain growth of 80%, sales cost rate rose nearly 7%. The significant increase was due to increased advertising costs for toothpaste and shampoo, accelerated promotion of new products and increased maintenance costs for the terminals.

The company's business includes the pharmaceutical industry and business. Industry grew about 30% per cent year-on-year in the first three quarters, and business grew about 20% per cent year-on-year. Company's business is mainly concentrated in Yunnan Province Pharmaceutical Co., Ltd., commercial growth is mainly due to relocation to the Chenggong new area after the increase in logistics competitiveness. Industry central Drug and transdermal business production and sales are in the pharmaceutical division, white powder toothpaste production in health products company, sales mainly in Yunnan white powder E-commerce Company, are in the health division.

The report estimated that the company 2012-2014 earnings per share of 2.26, 2.88, 3.69 Yuan, the health division continued rapid growth, the internal integration of the positive effect is expected to continue to be reflected in the next two years, reference can be compared to the company valuation, to give the company 2012 35 times times PE valuation, corresponding to the target price of 79.10 yuan to maintain the company's buying rating.

Risk hint: The price of Chinese herbal medicine increases cost pressure, new product promotion is not up to expectations.

(Securities Times News Center)

Cambe

Company in the day Cat Mall has the official flagship store, the main sales from the production of Beibei and Yongbong series of health care products and commissioned by the plant to extract the main health care products. Although the entrusted processing of health care products sales are good, but Beibei and Yongbong product series slightly aging, gradually unable to adapt to the current demand, health care products business this year as a whole to drag, the future company may consider the overall disposal of this block of business. Research report that although the electric business is a new platform, the current barriers to entry are not high, through a variety of marketing means to quickly increase the scale of the short-term, but the medium and long term competitive products are still the core, so the research is optimistic to enter the platform of the electric business has the core varieties of enterprises.

The acquisition of Xitao pharmaceutical industry is in line with expectations. Company in cash to acquire Yunnan Xitao Green Pharmaceutical 68.3% Equity, with October 31, 2012 as the benchmark day, the value of the company's total shareholder equity as the evaluation results, according to the proportion of the share of the shares to confirm the price of 258.5155 million yuan, in line with the market and analysts before the completion of the acquisition of the expected time. Through this acquisition, the Xitao pharmaceutical industry's main assets and business into, the company also fulfilled the relevant commitments to avoid peer competition, reduce recurrent linked transactions.

Strengthen the advantages of plant medicine, the advantages of complementary products. The company has dragon-Gold tong-lin capsules, anti-inflammatory cough tablets and other products, including Dragon Gold Tong Lin capsule is the exclusive products, has entered 8 provinces health Care directory, the company is expected to enter the national Health insurance directory before 14, is the company's future potential varieties, and the forefront of the formation of superior products complementary At the end of October this year has completed sales revenue of 45 million yuan, the year may be more than 60 million yuan. and Xitao Peace Branch has Yunnan province, one of the largest extraction production base, the annual processing volume of Chinese herbal medicines reached 6000 tons, ginkgo Biloba extract production capacity of more than 100 tons. Yunnan Ginkgo Biloba extract and tens of thousands of acres of planting base has further expanded the company's ginkgo industry chain strength.

Unified deployment of resources in the overall business. The transfer of equity, in addition to business complementarity, in customer resources, marketing channels, brand building and other aspects can also produce synergies, has been the company under a number of marketing platforms, resources have not been unified deployment, the study reported that after the completion of the acquisition, the company's platform is expected to be further integrated.

12-14 years to maintain the company EPS is 0.39 yuan, 0.49 yuan and 0.62 yuan earnings forecasts, according to the relative valuation method to take a shares than listed companies adjusted average PE32 times in 12, reached the target price of 12.48 yuan, to maintain "overweight" investment rating.

Risk hint: The merger of the acquisition enterprise is lower than expected, the health care products business drag.

(Securities Times News Center)