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The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

author:CBN Broadcasting

Since the beginning of this year, A-shares have fluctuated, but Dong'e Ejiao has gone all the way up, and recently hit a record high of 70.80 yuan. Since the beginning of this year, the stock price has risen by 38%, and the CSI 300 Index has risen by 2.64% over the same period.

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

Ejiao has a history of more than 3,000 years and is a traditional nourishing product. Since its listing, Dong'e Ejiao has always been a high-performing white horse stock in the Shanghai and Shenzhen stock markets, with the previous performance peak appearing in 2017-2018, and the company's annual net profit was as high as more than 2 billion yuan. The share price hit an all-time high of $68.56 in 2017. At its peak in 2017, Dong'e Ejiao accounted for 63% of the overall Ejiao market and was the strongest company in the industry, while its competitor Fupai Ejiao had a market share of only 19%. However, after that, Dong'e Ejiao suffered a "boiled donkey skin" turmoil, and its performance and stock price plummeted. The company's share price bottomed out at $22.57 in 2020.

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

Why has Dong'e Ejiao stepped out of a new round of upward channel since last year?

First, the performance is really good. On March 22, Dong'e Ejiao disclosed its 2023 performance report. According to the data, during the period, Dong'e Ejiao achieved revenue of 4.715 billion yuan, a year-on-year increase of 16.66%, a net profit attributable to the parent company of 1.151 billion yuan, a year-on-year increase of 47.55%, and a net profit of 1.083 billion yuan, a year-on-year increase of 54.70%.

Behind the performance growth, the gross profit margin of the company's products has risen to the highest level in history. Flush data shows that in 2023, the gross profit of Dong'e Ejiao products will be 70.24%, an increase of 4.2 percentage points compared with 65.99% in 2018.

Second, open the arrogant dividend. This time, Dong'e Ejiao announced a generous dividend plan, proposing to distribute a cash dividend of 17.80 yuan (tax included) for every 10 shares, with a total cash dividend of 1.146 billion yuan, which is almost equivalent to the net profit attributable to the parent company in 2023, and the dividend ratio has hit a record high.

3. The company's "cash" assets in reserve have hit a new high. As of December 31, 2023, the company's monetary balance was 5.826 billion, the balance of trading financial assets was 2.511 billion, and the total balance of the two accounts reached 8.337 billion, accounting for 62.66% of total assets.

Fourth, as a "time-honored brand", Dong'e Ejiao has taken many measures in recent years to attract young people, for example, and Nai Xue's tea (02150. HK) launched co-branded Ejiao milk tea, etc.

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

On the whole, after experiencing many difficulties, Dong'e Ejiao has achieved good results in reforms such as entering young people and focusing on its main business, and its performance and stock price have recovered, but it remains to be seen whether it can return to its previous peak state in the future.

At present, Dong'e Ejiao is still quite far from the historical peak in terms of revenue and net profit. The net profit in 2023 will be around 1.1 billion, which is only half of the peak.

It is worth noting that the year-on-year increase in sales expenses and marketing expenses has not brought the same proportion of the growth rate of operating income to Dong'e Ejiao, and the investment in marketing expenses has a marginal decreasing effect.

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

Gülen bought Dong'e Ejiao aggressively

On April 20, CEIBS disclosed the first quarter reports of 2024 for the three public funds managed by its fund manager Gülen, and their holdings also surfaced.

As of the end of the first quarter of 2024, the scale of public funds under management of Gülen is about 45.874 billion yuan, compared with 57.346 billion yuan at the end of 2023, and its fund management scale has shrunk by about 11.472 billion yuan, a decrease of 20%, and has fallen to the "40 billion" ranks.

In terms of heavy stocks, compared with the end of 2023, the China-Europe Healthcare Blend, which has the largest management scale, mainly reduced its holdings in the first quarter of 2024, and there was a change of 1 individual stock.

Specifically, among the top ten heavy stocks, Hengrui Pharmaceutical, Mindray Medical, Aier Ophthalmology, Tongrentang, China Resources Sanjiu, Tigermed, Pien Tze Huang, and Pharmaron have all reduced their positions. Among them, the number of positions of Aier Ophthalmology, Pien Tze Huang and Tong Ren Tang decreased by more than 10% compared with the previous period.

In addition, WuXi AppTec was slightly increased by Gülen. The most striking thing is that after nearly 7 years, Dong'e Ejiao once again entered the list of the top 10 heavy stocks in the Sino-European medical and health mix, accounting for 3.59% of the fund's net value, an increase of 81.91% from the end of 2023.

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

The top 10 heavyweights in the first quarter of 2024 are mixed by the Sino-European healthcare mix

The turmoil has dissipated, the stock price has reached a new high, and the 3000-year-old "holy product" welcomes spring again?

Preview of live classes

At 12:00 noon on Friday, April 26, the "Yicai Knows" platform will continue to open a wonderful live class, with Wang Ying, the host of CBN Broadcasting, and Xu Shirong, the manager of the "Northbound Lunch Report" column of "Yicai Knowing", will share the theme of "New Perspectives on Financial Reports under the New China Nine Articles" through video. There will also be limited-time coupons and small gifts during the live broadcast!

Author: Xu Jinhua

Editor: Xu Jiayuan

Producer: Wang Junji

This article is the exclusive content of the WeChat public account of "CBN Broadcasting", please contact the background for authorization before reprinting. The individual stocks involved in this article are for reference only, and are not recommended for trading and are not responsible for personal income.

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