Since completing the acquisition of Shanghai Aladdin Biochemical Technology Co., Ltd. and including it in the consolidated financial statements, Aladdin (688179.SH), which was originally experiencing a decline in profits, achieved rapid growth in performance in the first half of this year.

On a consolidated basis, in the first half of 2024, Aladdin achieved revenue of 0.238 billion yuan, a year-on-year increase of 28.59%, and a net profit attributable to the mother of 47.2699 million yuan, a year-on-year increase of 52.91%. Among them, Shanghai Aladdin Biochemical Technology Co., Ltd. contributed revenue of 31.6816 million yuan and a net profit attributable to the mother of 5.9448 million yuan to the consolidated financial statements. Excluding the contribution from Shanghai Aladdin Biochemical Technology Co., Ltd., Aladdin's revenue growth rate in the reporting period was 11.51% year-on-year, and the net profit growth rate was 33.68%.

According to Aladdin, before being included in the consolidated financial statements, Shanghai Aladdin Biochemical Technology Co., Ltd. has seen continuous growth in performance in recent years, with revenue and net profit in 2023 reaching 0.105 billion yuan and 36.8213 million yuan, respectively. If included in Aladdin's financial statements, Aladdin's revenue and profit in 2023 would increase by 25.93% and 44.21%, respectively. In fact, Aladdin's revenue and net profit growth rates in 2023 were 6.55% and -7.48%, respectively.

It is worth noting that when Aladdin acquired Shanghai Aladdin Biochemical Technology Co., Ltd., the original shareholders of the latter made performance commitments. It was agreed that the non-deductible 'audited net profit' of Shanghai Aladdin Biochemical Technology Co., Ltd. for the years 2024-2026 should not be less than 33 million yuan, 40 million yuan, and 4.7 million yuan. If the actual cumulative net profit is less than 90% of the committed amount, performance compensation will be required.

During the performance briefing held on the 14th, the Chairman and General Manager of Shanghai Aladdin Biochemical Technology Co., Ltd., Xu Jiuzhen, was asked by a reporter from the 'Star Market Daily' about the main clients and business revenue provided by Shanghai Aladdin Biochemical Technology Co., Ltd. to Aladdin during the reporting period, but no response was given. Regarding whether Shanghai Aladdin Biochemical Technology Co., Ltd. can meet the performance commitment for 2024, Xu Jiuzhen also stated that attention should be paid to future regular reports.

Information shows that Shanghai Aladdin Biochemical Technology Co., Ltd. is a research reagent manufacturer whose products are used in institutions of higher education, research institutes, as well as research institutions of biomedical, new materials, new energy, energy-saving and environmentally friendly, aviation, aerospace, and other high-tech industries, and institutions related to strategic emerging industries. Shanghai Aladdin Biochemical Technology Co., Ltd. is also engaged in the research, development, production, and sales of research reagents. The 'Shanghai Aladdin' reagent brand is well known in the industry.

The difference lies in the fact that a higher proportion of high-end chemical reagents are in Aladdin's reagent products, which is different from Yuan Ye Biotechnology's product line. The journalist from "Star Daily" asked Aladdin about the current situation of a higher proportion of high-end products, and whether it would face limited growth difficulties. Xu Jiuzhen stated, "The company's products are divided into four major categories, with a complete variety and sufficient inventory, and expansion plans in various categories."

In addition, regarding the changes in the industry's business climate, Zhao Xin'an, the deputy general manager of Aladdin and secretary of the board of directors, revealed, "As universities resume normal teaching and research activities, university customers are recovering quickly, with an increased proportion. In recent years, as universities have expanded enrollment and the number of graduate students has increased, the demand from universities is also on the rise." Zhao Xin'an stated that the research service industry can still maintain a relatively high growth rate in the future.

It is worth noting that currently, foreign enterprises still control the majority of the market share in the domestic research reagent market. Most domestic research reagent companies tend to rapidly expand the market by representing foreign brands and competing on price. In contrast, Aladdin has abandoned the development strategy of representing foreign brands and independently created products including the "Aladdin" brand of research reagents. However, Aladdin also frankly stated that the current market share of the company is still low.

At the performance briefing, Xu Jiuzhen further revealed that foreign brand varieties are abundant, with a significant brand effect and in an absolute advantageous position. Domestic enterprises started developing relatively late, with a faster growth rate but smaller scale, and the brand is still being established. However, he also stated, "With the development of domestic reagents, the speed of import substitution is noticeably increasing. In the future, the company will increase high-level R&D investment, further expand market development efforts, and increase market share."

In the first half of 2024, Aladdin's total R&D investment amounted to 30.2886 million yuan, a year-on-year increase of 14.92%. The total R&D investment accounted for 12.70% of the revenue ratio, a decrease of 1.51 percentage points compared to the same period last year.