全球指数

HYGEIA HEALTHCARE(6078.HK):1H24 RESULTS MISSED;MAY FOCUS ON SHARE BUYBACK INSTEAD OF M&A IN SHORT TERM

中银国际研究有限公司2024-09-03
Amid industry headwind, Hygeia delivered lower-than-expected results in 1H24, with revenue up 35.4% YoY and net profit up 15% YoY. Oncology business grew 35% YoY in 1H24, accounting for 44% of total revenue (vs. 45% in 1H23). The percentage of amounts that may not be collected from medical insurance fund in revenue increased, which might be due to tight fund budgets. Post results, we cut our 2024-26 revenue forecasts by 12-13% to reflect slower-than-expected organic growth and soft discretionary medical consumption appetite. Revised 12-month DCF-based TP to HK$31 and maintain BUY rating.
Key Factors for Rating
1H24 results missed; increased percentage of amounts that may not be collected: revenue grew 35.4% YoY to RMB2.38bn, including hospital business revenue which increased 37.2% YoY to RMB2.31bn. Given the impact of acquiring Yixing Hygeia and Chang’an Hopital, we believe the organic growth was below our expectation. Gross margin decreased by 0.7ppt YoY to 31.8%. Net profit increased by 15% YoY to RMB385m.The net free cash flow turned positive in 1H24 thanks to lower capital expenditure (-39% YoY to RMB340m). Hygeia disclosed that the growth of operating revenue, which added back the amounts that may not be recovered from the public medical insurance fund, was +37.6% YoY. Notably, the percentage of amounts that may not be collected from medical insurance fund in revenue grew to 2.7% in 1H24 vs. 1% in 1H23 and 2.4% in 2023.
May focus on share buyback instead of M&A in short term and has sufficient land for self-built hospital expansion: Due to the poor performance of the stock YTD, instead of M&A, the management believes share buyback is more favorable to maximise shareholders’ interest. Hygeia resolved a repurchase scheme of up to RMB200m. As of 30 June, Hygeia has cash and trading assets of RMB735m. For self-built hospital expansion, Hygeia has 1,200 mu of land and has several new hospitals and phase II projects to construct. Upon full operation of the hospitals in construction and the expansion of Phase II projects for existing hospitals, the bed capacity will exceed 16,000 beds, including Dezhou Hyegia (1,000 beds), Wuxi Hygeia (800-1,000 beds), Changshu Hygeia (800-1,200 beds), Hezhou Guangji phase II (500 beds), Chang’an Phase III (1,000 beds), Yongding Phase II (500 beds) and Kaiyuan Jiehua phase II (500 beds).
Key Risks for Rating
(i) Changes in regulatory regime for the healthcare services industry; (ii) worse- than-expected impact from DRG/DIP rollouts; and (iii) less-than-expected efficiency in constructing and running new self-built hospitals.
Valuation
We cut 2024-26E revenue by 12-13% to reflect slower-than-expected organic growth and soft discretionary medical consumption appetite. We lifted WACC from 10.0 to 10.6 % to reflect policy uncertainty, and lowered terminal growth rate from 3% to 2% to reflect tight medical fund budget and strict DRGs execution. Revised down 12-month DCF-based TP to HK$31 and maintain BUY rating.

免责声明

以上内容仅供您参考和学习使用,任何投资建议均不作为您的投资依据;您需自主做出决策,自行承担风险和损失。九方智投提醒您,市场有风险,投资需谨慎。

推荐阅读

暂无数据

公司动态

    暂无数据

盘面综述

    暂无数据

IPO动态

    暂无数据

港股涨幅榜
  • 港股通
  • 红筹股
  • 国企股
  • 科技股
  • 名称/代码
  • 最新价
  • 涨跌幅

暂无数据

扫码关注

九方智投公众号

扫码关注

九方智投公众号