\u3000\u3000 Shandong Bailong Chuangyuan Bio-Tech Co.Ltd(605016) (605016)
The company is a leading bioengineering enterprise deeply engaged in the cause of nutrition and health. The company is a national high-tech enterprise integrating production, learning and research, with bioengineering as the leading industry, and the flagship enterprise of “China Functional Sugar City”. The main business is the R & D, production and sales of prebiotic series products, dietary fiber series products, other starch sugar (alcohol) series products and health sweetener products.
The main business prebiotics and dietary fiber business plays an important role in the world. The company’s products prebiotics and dietary fiber have multiple health effects and wide application fields, and have huge economic value and market space. In 2019, the total output value of China’s prebiotics / dietary fiber industry is 2.4/3.8 billion yuan, which is expected to reach 3.6/5.2 billion yuan and CAGR is 7% / 5.4%. The production scale of prebiotics and dietary fiber products of the company ranks in the forefront of the industry. In 2018, the product output accounted for 6% / 12.5% of the world respectively, occupying an important market share and position, and is expected to fully benefit from the space and growth of the industry.
The downstream demand for healthy sweeteners is strong, and the company’s alodonose products are ready to go. Under the trend of health, the public has a strong demand for “sugar substitutes”. The market scale of sugar free beverages in 2019 was 9.87 billion yuan, and the CAGR in 2014-2019 was 42.84%; In addition, sugar free beverages in China account for only 1.25% of soft drinks (excluding packaged drinking water), and there is a wide growth space. As a new sugar substitute with the functions of preventing dental caries and reducing blood sugar, alodonose has been approved by FDA and other countries, and the market growth rate is high; The company’s alodonose business takes the lead in realizing the layout and production in China and has been recognized by the overseas market. It is waiting for the approval of alodonose in the Chinese market, which is expected to become the highlight of the company’s new business.
Strong R & D capability, sound customer marketing network and high downstream stickiness create the core competitiveness of the company. The company has rich products and continuously develops new products by using its own technical advantages. It is one of the few suppliers in the industry that can fully meet the diversified needs of customers. Build a sales network covering major markets in the world. In order to ensure the unity of their own product taste and relevant indicators, downstream customers rarely change suppliers and have high customer stickiness; Over the years, the company has served questnutrition, halotop, nongnongshan spring, Mengniu, Yili and other well-known brands, forming customer resource advantages.
Profit forecast: we expect the net profit of the company in 2021 and 2022 to be 104 million yuan and 173 million yuan respectively, corresponding to EPS of 0.82 yuan and 1.36 yuan. The current share price corresponds to a PE value of 19.23 times in 2022. We are optimistic about the industry space and growth rate of the company’s main prebiotic and dietary fiber industries, and believe that the company, as a leading enterprise in the industry, is expected to fully benefit from the growth of the industry; They are optimistic about the promotion of the new business alodonose overseas and the pending review in China, and give a “strongly recommended” rating for the first time.
Risk warning: major changes in food additive industry policies; Major changes in trade policies; Food safety issues
