Updating our views: Growth for the leading pharmacies has been strong in 3Q20, with top- and bottom-line growth of 20-30%, while same-store sales growth accelerated to 12-13% as a result of increased traffic due to COVID-19 and prescription (PRX) drug outflow. We think PRX drug outflow and industry consolidation will continue to drive the leading pharmacies to deliver strong growth in the foreseeable future, but the rising valuations of local pharmacy leaders may impede their expansion in the short term. In our coverage, Laobaixing (LBX) has an extensive network and an attractive valuation (40x 2021e PE vs 57x and 48x for Yifeng Pharmacy (YF) and DaShenLin (DSL), respectively, and 1.7x 2021e PS vs 3.1x for both YF and DSL, respectively). We are positive on YF’s strategy and expansion capabilities; however, we think these advantages are priced in.