#以书之名#
In the recent stage, its ROE and ROIC have dropped sharply and then remained stable.
The sharp drop in ROE is due to the listing of H shares in 2011 and the issuance of new shares, which increased the owner's equity and decreased the equity multiplier
Subsequently, ROE and ROIC increased steadily, with ROE rising from 8.6% in 2012 to 10.72% in 2017, and ROIC rising from 8.06% in 2012 to 8.73% in 2017
ROE is rising steadily, and when taken apart, it turns out that the equity multiplier is rising.
At this stage, on the basis of the original business scale, Shanghai Pharma continued to expand through mergers and acquisitions
It has successively acquired more than 30 companies such as Changzhou Kangli Pharmaceutical (2012), Nantong Zhongbao Pharmaceutical (2012), Shandong Guolin Pharmaceutical (2013), Vitaco (2016), and Cardinal Malaysia (2017), involving the sales of APIs, pharmaceuticals, health care products, and medical equipment.
Cardinal Health Malaysia is one of the three giants in the pharmaceutical distribution industry in the United States, and Cardinal Health's business in mainland China is divided into five major sectors: pharmaceutical distribution, medical device distribution, hospital direct sales, specialty pharmaceuticals, specialty pharmacies and business technology
In 2016, the scale of distribution in mainland China ranked eighth in the country.
Obviously, behind this logic, is the development idea of "platform + application", with the help of its own advantages in pharmaceutical circulation, through continuous mergers and acquisitions, loading its upper application (drugs), as long as you can get the explosive model, then the sales level is not a problem, therefore, mergers and acquisitions amplify the leverage.
In 2011, Shanghai Pharmaceutical's interest-bearing liabilities were 5.728 billion yuan, rising to 16.763 billion yuan in 2017, an increase of 192.65%, and the equity multiplier rose from 2.35 in 2011 to 2.7 in 2017
However, despite the expansion of business scale through mergers and acquisitions, it seems that the synergies have not yet been released, and its revenue growth rate and net profit growth rate have shown a downward trend as a whole
Note that revenue growth has dropped from 40% to below 10%, and net profit growth has dropped from 15% to below 10%.
In 2011, the net profit growth rate of 30% was due to the investment income obtained from the disposal of the equity of the subsidiary, which increased the net profit growth rate, and did not do business analysis
Moreover, what is puzzling is that at this stage, it has been engaged in mergers and acquisitions, but it has not increased the growth rate of performance, but has declined in 2012, 2013, 2015 and 2017 at the inflection point?
First of all, in 2012, the growth rate of the industry dropped from 33.1% to 18.5%, due to the impact of many unfavorable factors such as drug price reduction, medical insurance control, basic drug bidding, and resistance restriction policies
Secondly, in 2015, the growth rate of the industry fell from 16.7% in 2013 to 10.2% in 2015, due to the full implementation of medical insurance cost control across the country.
Thirdly, in 2017, the industry's growth rate fell further to 8.4%, due to the introduction of the "two-invoice system" reform
You see, although the layout route has long-term prospects, it faces a series of policy blows in the short term.
Among them, the reform of the "two-invoice system" is known as a blockbuster in the field of pharmaceutical circulation
Before the reform, pharmaceutical distribution companies, as intermediaries connecting pharmaceutical companies and terminal medical institutions, would purchase drugs from upstream pharmaceutical companies and transfer them to secondary distributors, or directly sell them to medical institutions
One is to earn delivery fees, and the other is to earn advance fees (mainly for net sales business)
However, this traditional way will breed intermediate circulation links, and the price of drugs will be seriously increased, so the two-invoice system will be implemented in this context.
Predict the follow-up and listen to the next breakdown
It does not constitute any investment advice, the stock market is risky, and you need to be cautious when entering the market