Big Bang! 31 Institutions Eye Foreign-Funded Hospitals
Here is the translation of the provided text into English: "The ironclad market, the flowing themes.
Although the market has not shown much improvement in recent days, hot spots have been coming one after another.
There are definitely opportunities in the market, such as the private hospitals I want to discuss with everyone today (September 9th).
Private medicine is not a new concept or theme, but there are indeed many new driving factors, such as allowing the establishment of wholly foreign-owned hospitals.
So, how sustainable is this main opportunity?
Today's market has a phenomenon, which is that the 'high-profile stocks' that have been hotly speculated in this period, have received multiple limit-up boards, and have seen their stock prices rise rapidly, have begun to diverge.
Typical companies like Shenzhen Huaqiang, Xin Ya Process, and Dazhong Transportation have all ended with limit-down boards.
However, there are also many hot spots that have begun a 'seamless' relay, such as the large medical sector, among which private hospitals, immune therapy, and a few other sub-segments have risen the most fiercely.
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Also, it's worth mentioning that many private hospital concept stocks also have immune therapy concepts.
Looking at private medical care, a batch of private hospital concept stocks have all seen significant increases or limit-up boards, like Yingkang Life, Hainan Haiyao, Jimin Health, International Medicine, Guangzheng Ophthalmology, He's Ophthalmology, and Aoyang Health, etc., and most of the targets have shown very strong explosiveness and are all at relatively low positions.
Taking Yingkang Life as an example, the company once entered the field of radiation surgical equipment by acquiring 100% of the equity of Maxiepu, injecting medical device business.
On September 9th, the company's stock price closed with a low-position '20cm' volume limit-up board (see attached figure).
Hainan Haiyao has already closed two limit-up boards on September 6th and September 9th.
The rise behind the private hospital and immune therapy sectors may not be unrelated to the following factors.
First, it is about wholly foreign-owned hospitals.
On September 8th, the Ministry of Commerce, the National Health Commission, and the National Medical Products Administration issued a notice on carrying out pilot work to expand openness in the medical field.
It mentioned that in the field of wholly foreign-owned hospitals, it is planned to allow the establishment of wholly foreign-owned hospitals in Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen, and the entire island of Hainan.
Wholly foreign-owned hospitals are also within the category of private hospitals.
The second is about foreign investment in genetic diagnosis, etc.
The notice from the Ministry of Commerce and others stated that from the date of publication, China's four major free trade pilot zones (Beijing, Shanghai, Guangdong, and Hainan) will allow foreign-invested enterprises to engage in the development and application of human stem cells, genetic diagnosis, and treatment technologies.
Let's first explain what a private hospital is.
A private hospital refers to a hospital with a private nature.
Most of them are health institutions established by social funding with profit-making institutions as the main body; there are also a few non-profit institutions.
Looking at the concept of the sector, some medical and health care companies that cooperate with private hospitals are also classified as private hospital concept stocks.
From the data, the number of private hospitals has been increasing over the years.
According to the statistical bulletin of national economic and social development, there were 27,000 private hospitals in the country at the end of 2023.
However, at present, China is still dominated by public hospitals.
According to the Weining Health interactive platform, public hospitals are the main body of China's medical service system.
According to the National Health Commission statistics, in recent years, the average number of outpatient visits to public hospitals accounts for about 85% of the total number of outpatient visits to hospitals, and private hospitals account for about 15%.
Weining Health also stated that the company's hospital customers are also mainly public hospitals, and according to rough statistics, the order amount of public hospitals accounts for more than 90%, and the order amount of private hospitals accounts for less than 10%.
Recently, there are no shortage of policies related to supporting private hospitals.
Such as in June this year, the 'Deepening Medical and Health System Reform 2024 Key Work Tasks' were issued, Xiangcai Securities believes that the 2024 medical reform key tasks proposed the formulation of policies to promote and standardize the development of private hospitals, compared with 2023, the expression of promotion has been added, and it believes that this will be beneficial to the development of private hospitals.
Many companies have stated that the business related to private hospitals is contributing to good performance.
According to Pumen Technology, in the first half of 2024, the company's skin medical beauty business achieved a year-on-year increase of 34%, mainly from private hospitals, and the business line is progressing smoothly.
Other companies have stated that private hospitals are a key market field for the company.
For example, Chengguang Medical, which mainly operates magnetic resonance detectors, currently has private hospitals and public hospitals at the secondary level and below as the main customers for the whole machine.
Looking at the entire concept of private hospitals, the overall performance has remained stable.
According to statistics of 65 private hospital concept stocks, 47 have achieved profitability in the 2024 interim report, accounting for 72%; 30 have achieved growth in net profit in the interim report, accounting for 46%.
For example, Xinhua Medical, in the first half of 2024, the company achieved a revenue of 5.187 billion yuan, a year-on-year increase of 2.24%; net profit was 484 million yuan, a year-on-year increase of 5.57%.
Xinhua Medical's main business is medical equipment and equipment, pharmaceutical equipment, and medical services.
From January to May this year, the company's medical equipment export orders increased by more than 50%.
Another example is Ankang Bio, whose main business is biotechnological products such as genetic engineering, cell engineering, and genetic testing.
In the first half of 2024, the company achieved a revenue of 1.299 billion yuan, a year-on-year increase of 0.9%; net profit was 416 million yuan, an increase of 4.99% compared to the same period last year.
In addition to the aforementioned Xinhua Medical, Ankang Bio, Aier Eye Hospital, Samsung Medical, Mayinglong, Tongce Medical, and Sanuo Bio also achieved good net profits in the first half of this year.
Observing the reasons for the performance growth of private hospital concept stocks, most of them are related to market demand and other fundamental factors.
For example, Yuheng Pharmaceutical, the company achieved a net profit of 125 million yuan in the first half of 2024, a year-on-year increase of 342.39%.
Yuheng Pharmaceutical takes the pharmaceutical business as the core, and the company stated that the performance growth in the first half of the year is related to the rapid growth in sales of some core products such as An Nao pills/tablet, and injection of multi-vitamins (12).
Another example is Dajia Wei Kang, the company mainly engages in the distribution and retail business of drugs, biological products, medical devices, etc.
The company's stock price once rose by nearly 10% on September 9th.
In the first half of 2024, the company achieved a net profit attributable to the parent company of 31.834 million yuan, a year-on-year increase of 75.04%.
It stated that the growth in performance is mainly related to the gradual expansion of the national sales channels of the pharmaceutical industry sector under the company and the gradual growth of the retail pharmacy business.
At the node of good driving, a solid foundation, and most of the stock prices of private hospital companies at a low position, many concept companies have received key recommendations and attention from institutions.
According to the statistics of Wind within nearly 180 days, many private hospital concept stocks have received more than 10 institutions' buy and increase ratings.
Companies like Aier Eye Hospital, Sanuo Bio, Huaxia Ophthalmology, Renfu Medicine, Fangsheng Pharmaceutical, Tongce Medical, and Samsung Medical have all exceeded 10, with Aier Eye Hospital receiving the most recommendations from institutions, with 31.
Looking further, the logic of institutional attention mainly focuses on the improvement of the company's operations, performance, and other fundamental factors.
Taking the eye medical company Aier Eye Hospital, which received the most recommendations from institutions, as an example, Dongwu Securities' research report on August 28th pointed out that in the future, as the penetration rate of refractive surgery, optical products, etc.
continues to improve, the company's consumer ophthalmology is expected to achieve steady growth, giving the company a buy rating; Guotou Securities' rating report on August 25th stated that it maintains a 'buy' rating for Aier Eye Hospital, with the highest target price of 12.3 yuan, as of the closing price on September 9th, the company's stock price was reported at 9.53 yuan.
Sanuo Bio also has a high degree of attention from institutions, with a total of 18 institutions giving buy and increase investment ratings.
Sanuo Bio's main business is blood glucose monitoring system products.
In the first half of this year, the company achieved a net profit attributable to the parent company of 197 million yuan, a year-on-year increase of 12.61%.
Recently, the company's stock price has also shown abnormal performance, with increases of 8.89% and 7.42% on August 29th and September 4th, respectively.
Regarding the logic of attention, Dongwu Securities' view on August 30th, 2024, believes that Sanuo Bio, as a leading company in the industry, is expected to continue to maintain rapid growth in the future, maintaining a 'buy' rating; Huachuang Securities gave the company a valuation of 41 times for 2024, corresponding to a target price of about 32 yuan.
As of the closing price on September 9th, Sanuo Bio's stock price was reported at 24.52 yuan, with a 30% increase space compared to the target price of 32 yuan."
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