\u3000\u3000 Chongqing Taiji Industry (Group) Co.Ltd(600129) (600129)
Event: the company issued a performance forecast. In 2021, the company’s net profit attributable to the parent company lost about 470 million yuan, deducting the net profit not attributable to the parent company lost about 630 million yuan. In 2021q4, the net profit loss attributable to the parent company is 720 million yuan, and the net profit loss not attributable to the parent company is 650 million yuan deducted in 2021q4.
Reform will be gradually promoted in 2021, and light equipment will be realized in 2022. After the introduction of Sinopharm, the reform will be carried out in an orderly manner, and the work of standardizing governance, focusing on the main business and marketing reform will be completed in 2021. The main losses come from: 1) in 2021, the company decided to focus on the development policy of main business. The main losses this time come from the liquidation of non main business and non-profit asset projects, and the provision for asset impairment is about 200 million yuan; 2) Improve the post retirement benefits of employees and accrue about 140 million yuan of defined benefit plans; 3) In order to promote new products, the company increased revenue, increased market investment and increased sales expenses. In 2022, it is expected to achieve light loading and significantly release performance.
Huoxiang raised prices to release profits, and the prices of second-line varieties increased significantly. We expect that by 2025, Huoxiang Zhengqi oral liquid is expected to exceed 3 billion yuan and create three core key varieties with more than 1 billion yuan. In December 2021, the ex factory price of Huoxiang Zhengqi oral liquid increased by 12%. It is expected that the income of Huoxiang Zhengqi oral liquid will exceed 1.2 billion yuan and the net profit will exceed 150 million yuan in 2022. The second-line varieties of Taiji Jizhi syrup, Tongtian oral liquid and sinusitis oral liquid have all achieved a significant increase in the bidding price of online bidding. The national online bidding work will be completed in 2021, and more than 60% growth will be achieved in 2021q1-q3 Taiji Jizhi syrup. The effect of price increase has initially appeared, and the performance will be further released in 2022.
Endogenous accelerated transformation, epitaxial expansion and leapfrog development. 1) Endogenous: the business level focuses on the transformation of variety strategy and marketing strategy, standardizing governance and improving efficiency. ① Develop innovative drugs and secondary development of main varieties to strengthen key categories. Strengthen R & D investment. At the end of the 14th five year plan, the investment intensity of the whole company will exceed 5% (industrial proportion), and accelerate the construction of Taiji science and innovation center. ② Innovate the marketing mechanism and mode, innovate the incentive mechanism and elimination mechanism, promote digital marketing, ensure the annual growth of key products by more than 30%, adhere to academic marketing in the medical market, expand channels at OTC end and expand regions. ③ We will establish a mechanism to encourage employees to withdraw from the company, and promote the reform of performance based distribution. 2) Extension: capital market operation helps leapfrog development. The company actively promoted capital and share increase, introduced development funds, reduced asset liability ratio, and actively sought mergers and acquisitions of outstanding enterprises in the industry.
In the 14th five year plan, we will strive to break through the revenue of 50 billion yuan, and the industrial net profit margin is expected to reach 10%. From the perspective of strategic objectives, the company puts forward three development directions: Taking Modern Traditional Chinese medicine manufacturing as the main line, supplemented by hemp essence characteristic chemical drugs and regional commercial leading enterprises. The company will become the strategic growth pole of Sinopharm group in Western China. Through endogenous development and extension expansion, the company will strive to achieve an operating revenue of 50 billion yuan by the end of the 14th five year plan. From the perspective of endogenous growth, it is expected that the compound growth rate of the income end of the industrial sector will reach 30% from 2022 to 2025, and the net profit margin is expected to recover to 10%. It is expected that the industry will contribute 1.5-2 billion yuan of net profit in 2025.
Profit forecast: in view of the rapid improvement of operating performance brought by the entry of Sinopharm into Taiji, excluding non recurring profits and losses, it is estimated that the net profit attributable to the parent company from 2021 to 2023 will be -470 million yuan, 310 million yuan and 530 million yuan respectively, the EPS from 2021 to 2023 will be -0.84 yuan, 0.56 yuan and 0.95 yuan respectively, and the corresponding PE from 2022 to 2023 will be 31 times and 18 times respectively.
Risk warning: expense control is less than expected, sales of core varieties is less than expected, and disposal of assets is less than expected.
