Asymchem Laboratories (Tianjin) Co.Ltd(002821) (002821)
Order: re sign large orders exceeding expectations and accelerate the reconfirmation of performance
On November 28, the company announced: “in the process of continuously providing cdmo services for a small molecule chemical innovative drug of a pharmaceutical company, the company has recently signed a new batch of supply contract for related products with customers. The contract amount is equivalent to about RMB 2.72 billion. If the contract is successfully performed, the delivery time is 2022”.
On November 16, the company announced the signing of a major contract of US $481 million, which means that the revenue side of the company may exceed expectations this time in 2022. Capacity support comes from the company’s expectation that 1390m3 will be released in 2021h2 and 1500m3 will be added in 2022. In addition, the company’s 2021 interim report disclosed that in the newly constructed plant, the company will further increase the application of continuous reaction to achieve the same reaction volume and higher output value. Therefore, we expect that there is still great flexibility at the capacity release end. We believe that the company’s continued acquisition of large orders exceeding expectations is a further verification of the company’s ability, and also lays a foundation for the subsequent acquisition of more high-quality orders. We are optimistic about the continuous improvement trend of the company’s industrial chain status.
Profit forecast and valuation
Considering that the newly signed orders will significantly increase the performance in 2022, we raised the company’s profit expectation in 2022. We expect the company’s EPS to be 4.16, 8.42 and 8.72 yuan / share from 2021 to 2023 (the previous forecast was 4.16, 6.39 and 8.20 yuan / share from 2021 to 2023). The closing price on November 26, 2021 corresponds to 115 times of PE in 2021 (57 times of PE in 2022), maintaining the “buy” rating.
Risk statement
The risk of declining prosperity of global innovative drug R & D investment, the risk of new business expansion falling short of expectations, competition risk, exchange risk, the risk of performance falling short of expectations, and the risk of new production capacity falling short of expectations.
