20181219-招商证券_香港_-阿里健康-00241.HK-Hangzhou_HQ_reverse_roadshow_takeaway_6页_1021kb

ALI HEALTH (241 HK) Summary

Core Content

Ali Health (241 HK) is a subsidiary of Alibaba Group, focusing on healthcare services and leveraging the broader Alibaba ecosystem to enhance its market position. The company has been actively participating in the healthcare sector, particularly through its integration with Electronic Medical Records (EMR) systems and the implementation of the "Connected" Ecosystem strategy. The report highlights the company's strong growth potential and its strategic positioning to benefit from ongoing healthcare reforms in China.

Main Points

• Market Position: Ali Health's light connection health services have reached over 1 million times daily on average, with a market share of 3-5% in China.
• EMR Partnerships: The company benefits from its strategic partnerships with Jiahe Meikang (15% stake) and Jiamei Online (45% stake), which together cover approximately 40% of hospitals in China and 60% of tier III hospitals.
• Policy Tailwind: The NHFPC's EMR modernization plan for tier II and III hospitals is expected to drive deeper integration of Ali Health's services into hospital ecosystems.
• Strategic Plan: The "Connected" Ecosystem strategy emphasizes synergies across its four business divisions, aiming to create a comprehensive healthcare platform with integrated traffic and data.
• Investment Recommendation: The report maintains a "BUY" rating with a target price of HK$8.1, indicating a potential upside of 24% from the previous price of HK$6.54.

Key Information

Financial Performance

Metric	FY18A	FY19E	FY20E	FY21E	FY22E
Consolidated Revenue (RMB mn)	2,443	5,094	8,204	12,656	18,713
% YoY Change	414%	109%	61%	54%	48%
Adjusted Net Profit (RMB mn)	10	59	266	511	860
% YoY Change	-110%	487%	352%	92%	68%
EPS Fully Diluted (RMB)	0.00	0.01	0.03	0.05	0.09
PER Adj (x)	5039.6	1061.3	241.2	125.3	74.5
PBR (x)	20.4	23.7	21.5	18.3	14.6

Shareholding Structure

• Alibaba Group: 67.50%
• Directors and Management: 6.97%
• Free Float: 25.53%

Key Data

• 52-week Range (HK$): 3.48 - 8.67
• Market Cap (HK$ mn): 76,373
• Avg. Daily Volume (mn): 20.09
• BVPS (HK$): 0.23

Strategic Focus

Ali Health is positioned to benefit from the NHFPC's EMR modernization plan, which aims to upgrade hospital EMR systems to higher levels. The company's EMR partners are expected to continue gaining market share, enabling Ali Health to expand its presence in healthcare service scenarios. The company's "New Retail" platform is anticipated to attract more pharmacies, further supporting its growth in the healthcare sector.

Investment Ratings

• Industry Rating: OVERWEIGHT (Expect the sector to outperform the market over the next 12 months)
• Company Rating: BUY (Expect the stock to generate 10%+ return over the next 12 months)

Analyst Disclosure

The analysts involved in the report certify that their views reflect personal opinions and that their compensation is not directly or indirectly related to the recommendations expressed.

Regulatory and Legal Disclosures

The report is prepared by China Merchants Securities (HK) Co., Ltd. and is intended for specific audiences, including investment professionals and high net worth individuals. It is not suitable for all investors and is subject to legal restrictions in certain jurisdictions, including the United States, Japan, and Canada. Investors are advised to independently evaluate any investment and consult financial and tax advisors before making decisions.