AOXIN Q & M DENTAL GRP LIMITED (SGX:1D4)
Aoxin Q&M Dental Group - A Strong Turnaround; High Growth Potential From Precision Medicine Capabilities
- Aoxin Q&M’s earnings are expected to turn around in 2022 (S$12m profit vs S$0.1m loss in 2021), with contributions from the newly-acquired Acumen and improved performance of its China dental business.
- Expansion into the COVID-19 ART testing business should complement Acumen’s existing PCR testing business. Also, Acumen’s expertise in the precision medicine space could open up many new future revenue streams.
- We initiate coverage on Aoxin Q&M with BUY rating.
Aoxin Q&M Dental Group - Company Background
- Aoxin Q&M Dental Group (SGX:1D4) has been listed on SGX since 2017 and is a growing provider of private dental services in Liaoning Province, Northern China. The group has expanded its operations and has to date 400 dental professionals, including 170 dentists, 180 dental surgery assistants and 50 laboratory technicians.
- Aoxin Q&M operates 10 dental hospitals and 6 polyclinics in 8 different cities in Liaoning Province. The group operates three core business segments:
- primary healthcare,
- dental equipment and supplies distribution and,
- laboratory services.
- Notable recent acquisitions include a 49% stake in Acumen Diagnostics which allows the group to enter the diagnostic business in Singapore and capture a portion of the testing capacity market in relation to COVID-19.
Expect strong turnaround in 2022 from Acumen and improved dental business.
- We expect Aoxin Q&M’s earnings provider of private dental services in Liaoning Province, China. It operates 16 dental centres across eight cities.
Potential expansion into COVID-19 ART testing business could boost earnings.
- Beyond the lucrative Polymerase Chain Reaction (PCR) testing Aoxin Q&M’s 2022 earnings, potentially lifting 2022 earnings by another 80%.
Acumen’s precision medicine expertise could open up many new revenue streams.
- Acumen has the expertise to huge revenue for Aoxin Q&M.
Good growth opportunity for dental services in China.
- There were approximately 236 dentists for every one million population, as reported in 2019. While this figure has grown over the years, it is still far below the levels of developed countries which range from 500 to 1,000 dentists, which indicates room for growth in the industry.
- See
- Continue to read the complete analysis on Aoxin Q&M Dental Group (SGX:1D4) in 16-page report attached below.
John Cheong
UOB Kay Hian Research
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https://research.uobkayhian.com/
2021-11-19
SGX Stock
Analyst Report
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