The pharmaceutical industry grasps the development trend and complies with the structural adjustment in 2011

On November 27, the industry grew steadily with a high valuation premium rate As of September of 2010, the pharmaceutical manufacturing industry has achieved a cumulative sales of 796.07 billion yuan, an increase of 25.3% year-on-year, with a high growth rate We expect a year-on-year growth of 24.9%, a year-on-year growth of 22% - 25% and a profit growth of 25% - 30% in 2011 Through multi-dimensional measurement and comparison, we believe that the current valuation premium rate of the pharmaceutical industry is at a historical high level, but vertically, the absolute valuation level of the pharmaceutical industry is not high, close to the historical average We should be optimistic about the long-term development prospects of the industry, focus on the opportunities for structural adjustment in the medium and short term, and support the long-term development prospects of the industry with aging, urbanization and sound health insurance system In the short and medium term, we believe that a variety of factors will promote structural changes within the pharmaceutical industry The guiding opinions on accelerating the structural adjustment of the pharmaceutical industry clearly defines the objectives and measures for structural adjustment, with the focus on supporting innovation and technology upgrading, promoting M & A and restructuring, and enhancing the industry concentration Investment strategy: grasp the development trend and comply with the structural adjustment We are optimistic about the long-term development prospect of the industry and give the industry a "buy" investment rating In terms of stock selection, we suggest to follow the structural adjustment of the pharmaceutical industry, select large pharmaceutical groups and innovative pharmaceutical companies, focus on the field of geriatric diseases, and follow the trend of medical reform policies We mainly recommend Zhongheng group, Kangmei pharmaceutical, Shuanghe pharmaceutical and Shanghai Pharmaceutical Risk warning: the price reduction of basic drug catalog and medical insurance catalog, the promotion of enterprise cost by the new version of GMP and pharmacopoeia, the forced promotion of the new version of drug price management measures, and the cost of reform brought by the reform of public hospitals to the industry.