研究报告全文：MN17Feb2023CMBInternationalGlobalMarketsEquityResearchCompanyUpdateAKMedical1789HKAcceleratingimportsubstitutionpositiveoutlookof2023ETargetPriceHK1144AKMedicalreportedapositiveprofitalertforFY22EexpectingrevenuetoPreviousTPHK920increasebyover35YoYandnetprofitattributabletoshareholderstoincreaseUpDownside1704byover100YoYbothofwhicharelargelyinlinewiththeconsensusestimatesCurrentPriceHK977StrongdemandofAKMedicalsproductsaftertheimplementationofChinaHealthcarejointVBPTherevenuegrowthinFY22EwasprimarilydrivenbythestrongJillWUCFAdemandofartificialjointsAsabigwinnerinthenationaljointVBPAK85239000842Medicalhasbeenallocatedapproximately81000pieceswhichrankedfirstjillwucmbicomhkamongallbrandsBesidesdistributorsarereluctanttosellimportedproductssincetheVBPnarrowedthepricegapbetweenimportedandCathyWANGdomesticproductscuttingmuchroomforprofitfordistributorsTherefore85239161729weexpecttheimportsubstitutionin2023EwouldcontinuetoacceleratecathywangcmbicomhkenablingAKMedicaltoconstantlygainsharefromMNCsStockDataExpectationonrapidrecoveryofsurgeryvolumein2023ETheMktCapHKmn96289outbreakofCOVID-19inlate2022negativelyimpactedthesurgeryvolumeAvg3mthstoHKmn88oftheorthopedicimplantaslargeamountsofmedicalresourceswere52wHighLowHK1030360directedtoCOVID-19patientsandtherebyslowingAKMedicalsrevenueTotalIssuedSharesmn11158SourceFactSetgrowthin2H22HowevertheorthopedicsurgerydemandwaspostponedratherthancanceledwhichwouldbedeferredtothefollowingyearWeShareholdingStructureexpectaquickrecoveryofChinasorthopedicimplantmarketin2023EasXimalayaLimited453COVID-19hassubsidedandthepricereductionafterVBPwillalsohelptoGaolingFund64SourceHKEximproveimplantdemand3D-printedproductsasthenextgrowthengineforAKMedical3D-SharePerformanceprintedproductssuchasICOScustomizedproductsaresafefromVBPAbsoluteRelativeandhavehigherprofitmarginsThenationalorthopedicVBPprovidedthe1-mth-144-1053-mth45-79Companywithvaluableopportunitiestointroduceitshigh-marginproducts6-mth332282tomorehospitalssincetheCompanysuccessfullyexpandeditshospitalSourceFactSetcoveragetoatotalof3497hospitalsandincreaseditschannelpenetrationinClassIIIhospitalsaftertheimplementationofjointVBPSincetheymet12-mthPricePerformancetheneedsofadifferentiatedmarketweexpectthe3D-printedproductstoofferfurtherupsidepotentialinthefutureAdditionallyAKMedicalhasextendeditsbusinesstothedigitalintelligentorthopedicandotherfieldssuchasbiomaterialssegmentandoralprostheticsInlate2022andearly2023itsnavigationsystemforhipreplacementimplantsurgeryanddentalimplantsystemwereapprovedbyNMPAenhancingitsfuturecompetencyMaintainBUYWebelievetheVBPwoulddriveAKMedicalssolidgrowthSourceFactSetandthelongtermsharegainsWeexpectitsrevenuegrowthataCAGRof296from2023Eto2025EandraiseourTPfromHK920toHK1144basedona9-yearDCFmodelWACC954terminalgrowthrate30EarningsSummaryYE31DecFY20AFY21AFY22EFY23EFY24ERevenueRMBmn1035761106514441900YoYgrowth117265399355316NetprofitRMBmn31493193273377YoYgrowth1767051087411381EPSReportedRMBcents28583173245338YoYgrowth1107081081411381PEx5801063435308223Yield0202050609ROE1994592119147Netgearing363269365352345SourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk17Feb2023Figure1ValuationofpeersMktcapHKDTickerCompanyname22EPE23EPE22EPS23EPSmnRMBmn6699HKAngelalignTechnologyInc205948336291471191858HKBeijingChunlizhengdaMedi-H1297421218093746669HKAcotecScientificHoldingsL59737934851501036606HKNewHorizonHealthLtd14893NANA186100002901CHDoubleMedicalTechnology-A15572212179NANA688236CHBeijingChunlizhengdaMedi-A113613843099370688085CHShanghaiSanyouMedicalCo-A65613072469071688161CHShandongWeigaoOrthopaedi-A2735632626310383688617CHAptMedicalInc-A23417708524188136300633CHSonoscapeMedicalCorp-A2182561346511894688677CHQingdaoNovelbeamTechnolo-A9320518382195142688366CHShanghaiHaohaiBiological-A165526044167765300595CHOvctekChinaInc-A31820459352191145688212CHShanghaiAohuaPhotoelectr-A960720071056213141688050CHEyebrightMedicalTechnolo-A24132996697385267688271CHShanghaiUnitedImagingHe-A1513158626491641281789HKAKMedical1004756139810275Average656455160116SourceBloombergCMBIGMestimatesFigure2EarningsrevisionNewOldDiffRMBmnFY22EFY23EFY24EFY22EFY23EFY24EFY22EFY23EFY24ERevenue106514441900115015321990-74-58-45Grossprofit66088111507139351224-74-58-61Operatingprofit207301423223319473-70-57-106Netprofit193273377207288419-66-53-101EPSRMB017024034019026038-88-60-112Grossmargin620061006050620061006150000ppt000ppt-100pptOperatingmargin194720852226194320832375004ppt002ppt-149pptNetMargin181418901982180018812104014ppt009ppt-122pptSourceCompanydataCMBIGMestimatesFigure3Risk-adjustedDCFvaluationDCFValuationinRmbmn2022E2023E2024E2025E2026E2027E2028E2029E2030EEBIT20730142357569082196811331314Taxrate151515151515151515EBIT1-taxrate1762563604885866978239631117DA7474747489106125146170-Changeinworkingcapital103-163-208-222-266-317-374-438-508-Capex-80-80-80-80-96-114-135-158-183FCFF27487146261313372439514596Terminalvalue9394FCFTerminalvalue274871462613133724395149989Terminalgrowthrate30WACC954CostofEquity118CostofDebt50EquityBeta09RiskFreeRate280MarketRiskPremium100TargetDebttoAssetratio300EffectiveCorporateTaxRate150PVofenterprisevalueRMBmn10047NetdebtRMBmn797MinorityinterestsRMBmn0EquityvalueRMBmn10845EquityvalueHKmn12759ofsharesoutstandingmn1116PricepershareHK1144SourceCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE217Feb2023Figure4SensitivityanalysisWACC11448549049541004105440166014671311118210743515171354122011081012Terminalgrowthrate3014001260114410449592513021181107898991320121911121020941872Figure5CMBIGMestimatesvsconsensusCMBIGMConsensusDiffRMBmnFY22EFY23EFY24EFY22EFY23EFY24EFY22EFY23EFY24ERevenue106514441900107714441855-110024GrossProfit66088111506578571108052838OperatingProfit207301423210301428-1001-10Netprofit193273377196272376-150201EPSRMB017024034018025034-268-061046GrossMargin620061006050610259325971099ppt168ppt079pptOperatingMargin194720852226194520832305002ppt002ppt-078pptNetMargin181418901982182218852029-007ppt005ppt-047pptSourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE317Feb2023FinancialSummaryINCOMESTATEMENT2019A2020A2021A2022E2023E2024EYE31DecRMBmnRevenue9271035761106514441900Costofgoodssold283321262405563751Grossprofit6437154996608811150Operatingexpenses328346400453580727Sellingexpense175154187213274352Adminexpense9283105117152190RDexpense81105113128159190Others2046555Operatingprofit31636999207301423EBITDAnanananana497EBITnanananana423NetInterestincomeexpense689202020Pre-taxprofit321377109227321443Incometax546316344866Netprofit26731493193273377Minorityinterest000000Netprofitattributabletoshareholders26731493193273377BALANCESHEET2019A2020A2021A2022E2023E2024EYE31DecRMBmnCurrentassets111819031934221225112910Cashequivalents277713476727777864Accountreceivables272451388438593781Inventories229361423399494617Othercurrentassets340378648648648648Non-currentassets364624671677683688PPE284364382401419437Deferredincometax155176767676Intangibles367680675542Goodwill29133132132132132Othernon-currentassets000000Totalassets148225272605288931943598Currentliabilities328418489618705808Short-termborrowings000000Accountpayables7914693222308411Taxpayable324252525252Othercurrentliabilities217230345345345345Non-currentliabilities386684848484Deferredincome131212121212Othernon-currentliabilities255472727272Totalliabilities366484574703789892Sharecapital999999Otherreserves110720332022217723952696Totalshareholdersequity111620432032218624042706Minorityinterest000000Totalequityandliabilities148225272605288931943598PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE417Feb2023CASHFLOW2019A2020A2021A2022E2023E2024EYE31DecRMBmnOperatingProfitbeforetaxation321377109227321443Depreciationamortization285873747474Taxpaid334529344866Changeinworkingcapital17818631103163208Others617202020Netcashfromoperations145205177351164223InvestingCapitalexpenditure10735176808080Netproceedsfromdisposalofshort-term1805481039000investmentsOthers15542818202020Netcashfrominvesting272356297606060FinancingDividendpaid327537395575Netborrowings220000Proceedsfromshareissues07010000Others91364000Netcashfromfinancing22612101395575NetchangeincashCashatthebeginningoftheyear421277713476727777Exchangedifference42416000Cashattheendoftheyear277713476727777864GROWTH2019A2020A2021A2022E2023E2024EYE31DecRevenue543117265399355316Grossprofit573111301323333306Operatingprofit8431697301086451406Netprofit8421767051087411381PROFITABILITY2019A2020A2021A2022E2023E2024EYE31DecGrossprofitmargin694690656620610605Operatingmargin340356131195208223EBITDAmarginnanananana262ReturnonequityROE2731994592119147GEARINGLIQUIDITYACTIVITIES2019A2020A2021A2022E2023E2024EYE31DecNetdebttoequityx020403040403Currentratiox344640363636Receivableturnoverdays81112732010150015001500Inventoryturnoverdays254833565454360032003000Payableturnoverdays86812781660200020002000VALUATION2019A2020A2021A2022E2023E2024EYE31DecPE1975801063435308223PEdiluted2005831071435308223Divyield140202050609EVnanananana86449EVSalesnanananana45EVEBITnanananana204EVEBITDAnanananana174SourceCompanydataCMBIGMestimatesNoteThecalculationofnetcashincludesfinancialassetsPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE517Feb2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBIGMwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE6