Guojin Securities: Giant Biotech (02367) Holdings Increase Plan Shows Confidence in Maintaining a “Buy” Rating

The Zhitong Finance App learned that Guojin Securities released a research report stating that maintaining the “buy” rating of Giant Biotech (02367), the company's EPS for 25-27 is 2.40/2.93/3.54 yuan, respectively, and PE is 23/19/16 times, respectively. The bank expects the company's product matrix (medical device series+collagen repair series+focus series+hydration and sensitivity series+order series) to continue to grow. Since late May, the company's stock price has recovered. The bank believes that the core competitive advantage of the company's products is stable. As the influence of public opinion dissipates, mobile sales are expected to improve month-on-month, and the growth rate will pick up, and maintain profit forecasts.

Incident: The company announced the controlling shareholder's share increase plan on June 9. The company's controlling shareholder, Juzi Holding, increased the company's shares by no less than HK$200 million within 3-6 months from the date of the announcement, reflecting the controlling shareholders' firm confidence in the company's prospects.

Guojin Securities's main views are as follows:

Juzi Holding now holds approximately 54.26% of the company's shares

If the plan to increase holdings is implemented, according to the current stock price estimate of HK$61.2, Juzi Holding is expected to increase its holdings by 3.268,000 shares, accounting for about 0.3% of the total share capital, and the company is expected to maintain sufficient public shareholding. The company's board of directors believes that Juzi Holding's plan to increase its holdings reflects the controlling shareholders' long-term commitment to the company and their firm confidence in the company's prospects.

Looking forward to the future, the company will continue to adhere to the key direction of building a brand, expanding channels, and strengthening approval to promote various tasks and the improvement of the company's comprehensive strength

1) Product-side companies expect to increase investment in R&D, accumulate technical reserves, and complete clinical application approval for the three types of medical device products. It will refine more good products and series, gain insight into and meet more segmented needs, and enrich the content of its brands.

2) The company will step up marketing and promotion efforts for major brands, break the circle on a wider scale, and cultivate and incubate new brands to lay the foundation and prepare for the skincare business to reach the next level. ① Ke Fu Mei: Large medical dressings lead the market share. Collagen sticks continue to break the circle, repurchases and user structure are healthy, and the proportion of new customers is still high. Focus creams first became popular when they went on sale in April '24. Looking ahead to 25 years, collagen bars are expected to grow steadily under a high base. The product matrix (medical device series+collagen repair series+focus series+hydrating and sensitive series+order series) will continue to grow. ② Creigin: Continuously strengthening the anti-aging mentality. The top single product, Daemak King, has sold brilliantly. The bank is expected to continue to sell in volume for 25 years.

3) The company will gradually begin preparations for the commercialization of the three types of medical devices, prepare market education and training, and empower the Group's second growth curve.

Risk Alerts

Marketing launch, new product sales, technological development, and implementation of medical and aesthetic products fell short of expectations.