Cai Mingzi of 2021-12-13 Open Source Securities Co., Ltd., Gu Yihan conducted research on ordinary people and issued a research report "Company Information Update report: plans to acquire more than 650 stores of Huairen Great Health, consolidate the voice of Hunan base camp". This report gives a buy rating to ordinary people, and the current stock price is 45.91 yuan.

Ordinary people (603883)
Thickening the company's performance plans to acquire one of the most influential pharmacies in Xiangxi to consolidate the voice of the Hunan stronghold.
On December 10, the company announced that ordinary people signed a cooperation agreement with Hunan Huairen Great Health Industry Development Co., Ltd., intending to pay cash to buy 46% 72% of the reorganized shares of Huairen Great Health. Huairen Great Health has more than 650 self-operated pharmacies in Hunan and Guizhou, which will effectively fill the market of ordinary people in the western region of Hunan and consolidate the voice of Hunan base camp. After the completion of this transaction, ordinary people will achieve the first place in the number of seven stores in 14 prefectures and cities in Hunan Province, and the number of stores in Hunan Province is expected to exceed 2700 (including joining), making it the chain drugstore enterprise with the first number of stores in Hunan Province. Considering the impact of the epidemic on store operations, we downgrade our profit forecast for 2021-2023. It is estimated that the net profit of homing in 2021-2023 will be adjusted from 6.96,8.90,1.124 billion yuan to 6.84,8.56 and 1.055 billion yuan, corresponding to EPS 1.67pm 2.09pm 2.58 yuan per share, and the current stock price corresponding to PE is 27.4pm 21.9pm 17.8 times. The expansion of ordinary people's stores is progressing smoothly. The fine management ability, the integration ability is strong, the profitability is in the promotion period, maintains the "buy" rating.
With equal emphasis on self-construction and mergers and acquisitions, the joining model is advancing rapidly, and it is proposed to further accelerate the pace of expansion.
As of 2021Q3, the number of stores has reached 8163, including 6055 direct stores and 2108 franchise stores. The company added 1866 stores in the first three quarters of 2021, including 1259 direct stores (724self-built stores, 143asset mergers and acquisitions, 392equity mergers and acquisitions), 607stores joined, and stores expanded steadily. Continue to promote the spark model: as of 2021Q3, the company has acquired more than 2400 stores through the spark model (about 300 more than 2021H1), covering Jiangsu, Gansu, Inner Mongolia and other 9 provinces. It is proposed to further accelerate the pace of expansion: on July 8, the company received approval from the Securities Regulatory Commission on the fixed increase plan, which was approved by the Securities Regulatory Commission on June 21, and the total amount of funds to be raised will not exceed 1.74 billion yuan. used for new pharmacies, supplementary liquidity, etc., is expected to further accelerate the company's expansion and improve the quality of operation.
Improve the management ability of the company in an all-round way and build the brand of "ordinary people"
The company promotes the sustainable development by vigorously training pharmaceutical professionals, constantly improving the ability to undertake prescription outflow, actively developing online business, strengthening member management and other measures to improve business capacity in an all-round way.
Risk hint: store expansion speed and late integration, profit level is lower than expected

A total of 15 agencies have rated the stock in the last 90 days, including 11 buy ratings and 4 overweight ratings; the average institutional target price in the past 90 days is 57.65; according to the Securities Star valuation analysis tool, people (603883) have a good company rating of 3.5 stars, a good price rating of 3 stars and a comprehensive valuation rating of 3 stars. (rating range: 1-5 stars, up to 5 stars)