Second half of 2008 investment strategy report pharmaceutical industry - pharmaceutical industry, raw material medicine - pharmaceutical industry

Second half of 2008 investment strategy report pharmaceutical industry - pharmaceutical industry

, raw material medicine - pharmaceutical industry

Highlights: In the oscillation of the market, industry and the fundamentals of individual stocks is the most support and security indicators, since 2007, the pharmaceutical industry began a significant degree of recovery in the economy, this momentum has continued into this year in the first half. 1-4 months, the pharmaceutical industry output up by 28.51%. While rising oil and agricultural prices, a direct result of the chemical raw materials and Preparation And Chinese herbal medicines Costs, but sales of fast heavy volume, the industry's profit growth is very good, some upstream raw material prices and the elimination of the restrictions on the negative impact of drug prices. 2008 Jan-Feb, pharmaceutical manufacturing sales grew 32.1%, 51.6% growth in the total profits are record high. However, we believe that the first two months of high growth and early 2007 related to the low base, the annual profit growth of 40% or so.

Sub-industry, chemical API Benefit from price increases remained high growth market; pharmaceutical business class company, one-quarter revenue growth and increase the scale of drug use basically the same hospital; chemical and pharmaceutical industry sales continue to heavy volume; traditional Chinese medicine industry, raw material prices and products subject to limit the impact of declining growth rate.

08-year inflation pressure, Pharmaceutical Industry Can an exception? We believe that the various sub-sectors to be affected the same. The higher oil prices lead to higher prices of chemical products, chemical raw industry has a very strong ability to shift the cost; herbal medicines with agricultural property, price fluctuations, the State present for Pieces of Chinese medicine industry is not unified price limit, so slices enterprises has strong independent pricing. However, chemical medicine and Chinese patent medicines due to price limits, facing pressures from shrinking profit margins. Medicine as a pharmaceutical distribution business in the middle part, affected by inflation relatively small, but monetary policy will raise interest rates high demand for funds increased flow of corporate finance fees.

Although the macroeconomic situation has complicated changes, but we judge the pharmaceutical industry's fundamentals have not changed, that the pharmaceutical industry is one of the few still have investment value and security industries. Investors are advised to continue to pay attention in the business cycle of bulk drugs and benefits sub-sectors Medical Reform And concentration to improve the flow of trade, a strong ability to shift the cost of Chinese Herbal Medicine class of enterprises, but also can be due attention. Recommended Health America Pharmaceutical, Zhejiang, medicine, new, and into, the same medicine, Sinopharm shares and two-heron medicine.

1. Ruoshi, the fundamentals do not support more and more important to change up the cost of the rapid development of industry trends

In the oscillation of the market, industry and the fundamentals of individual stocks is the most support and security indicators, the pharmaceutical industry is also able to answer the question of investment, let us first look at the industry operating data. Since 2007, the pharmaceutical industry began a significant degree of recovery in the economy, this trend lasted until the first half of this year. 1-4 months, the pharmaceutical industry output value increased 28.51% year on year, of which chemical drug manufacturing industry rose 28.47 percent, up 24.73% of proprietary Chinese medicines, bio-medicine increase of 26.97%, Medical Devices An increase of 30.96 percent, the various sub-sectors have shown a good trend.

Oil and agricultural prices, a direct result of chemical raw materials and preparations, as well as the rising cost of Chinese herbal medicines.

Then, in the context of inflation, the pharmaceutical industry can withstand the pressure of shrinking profit margins? From the latest data we can see that, due to the rapid sales of heavy volume, the industry's profit growth is very good, some upstream raw material prices and the elimination of the restrictions on the negative impact of drug prices, 08 January-February, pharmaceutical manufacturing sales 32.1% revenue growth, gross profit increased 51.6%, both record highs. However, we believe that the first two months of high growth and early 2007 related to the low base, the annual profit growth of 40% or so. 1-2 months in

2008, the pharmaceutical industry sub-sectors, the accumulated industrial sales output value is the largest chemical preparations manufacturing, industrial sales output value of 30.558 billion yuan, up 29.46 percent, 29.47 percent of the entire industry. Sales of industrial output increased year on year is the biggest Chinese Herbal Medicine processing and manufacturing, accumulated 4.686 billion yuan, up 38.61%.

Listed companies, the 2007 annual report, the pharmaceutical industry to achieve revenue growth of 17.9%, net profit rose 112.9%, compared to the two indicators in 2006 were 9.2% and 17.0% of the cases, can be said to realize the leap from the bottom . 2008 first quarter, while experiencing snow, the Spring Festival holiday, and other objective factors, such growth is still continued, the industry achieved revenue growth of 19.8%, net profit rose 35.6%. 07 in the first quarter year on year growth rate has not declined. Confirms our strategy in the 2008 report, the view, the turning point of the pharmaceutical industry has been established in 2007, and will continue to follow high degree of prosperity.

Sub-industry, chemical raw market is still benefiting from price increases to maintain high growth; pharmaceutical business class company, one-quarter revenue growth and increase the scale of drug use basically the same hospital; chemical and pharmaceutical industry sales continue to heavy volume; traditional Chinese medicine industry, raw material prices by and product limit the impact of declining growth rate.

08 background of inflation in raw materials and energy makes the medicine manufacturing industry prices, industry gross margins will be further squeezed, with a slow decline. Cost rate of the three industries continue to decline, the largest reduction in the rate of management fees, reflecting the improvement of corporate management efficiency. Inventory turnover and receivables turnover rate of increase over the previous year.

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