Tianjin Zhong Xin Pharma: FY14 net profit grew 2% to Rmb357.8m, while revenue expanded 18% to Rmb7.1b, driven by a strengthened marketing model to boost branding and sales. Bottom line growth was mitigated by gross margin that slipped 1.5ppt to 29.7% from increased share of distribution business, and a broad increase in operational expenses.
CIMB likes this stock, saying that Its Su Xiao Jiu Xin Pill is a household name in China for the treatment of cardio-vascular ailment. IN addition, the house flags that its A share is about 3x of s-share price
The stock is currently trading at 15.2x FY15E PE, vs an average of Singapore, HK, and China peer average of 26.7x.
CIMB maintains Add with TP of US$1.45