\u3000\u3 Shengda Resources Co.Ltd(000603) 456 Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) )
Event: the draft of restricted stock incentive was released, and the core backbone incentive was implemented one after another
On March 2, 2022, the company issued the 2022 restricted stock incentive plan (Draft), the key points of which include:
① incentive objects: a total of 297 people, of which the number of restricted shares granted to middle-level managers and core backbones of the company accounts for 87%.
② grant price: 23.82 yuan per share.
③ performance assessment objective: Based on the deduction of non net profit in 2020, the annual growth rate of deduction of non net profit from 2022 to 2024 shall not be less than 115%, 180% and 260%.
④ total expenses to be amortized: 43.5 million yuan in total, of which about 18.85 million yuan will be amortized in 2022.
Viewpoint: in the window period of supply capacity upgrading, the incentive & stability of backbone teams is more important
① the core is to help stabilize and motivate the team: Based on the analysis of the company’s business development trend and the company’s performance in 2021 (refer to the performance forecast data of 2021), we believe that the company has a high probability of successfully achieving the incentive goal in 20222024, which helps to enhance the stability of the company’s middle-level managers and core backbone team, The implementation of the rolling incentive plan is also conducive to the introduction of new talents and the incentive of old teams, which is conducive to the medium and long-term development of the company.
② cognition of development stage: from large customers and large projects to multi customers and multi projects, project experience and capacity expansion are very important. We believe that the upgrading of supply capacity and abundant project reserves are the marginal changes of the company after 2020. Specifically, they are reflected in the new breakthrough of asymmetric catalytic hydrogenation technology, the commercial application of new fluorination reagents, and the continuous flow technology is recognized as a provincial engineering research center. From the rhythm of the company’s capacity expansion (acquisition of Hangzhou Teva factory, expansion of Zhejiang Ruibo factory, technical transformation of Suzhou Ruibo factory, etc.), we pay attention to the significant increase in the proportion of non Novartis, difficult and high value-added projects of the company. In the window period of continuous upgrading of supply capacity, we believe that the continuous promotion of restricted stock incentive plan is of greater significance to the promotion of the company’s medium and short-term business.
Profit forecast and valuation
We expect that the company’s EPS from 2021 to 2023 will be 0.8, 1.1 and 1.5 yuan / share respectively, and the closing price on March 2, 2022 corresponds to 43 times of PE in 2022. We believe that the management experience of key customers and large projects is the foundation of the company in the next stage. We are optimistic about the marginal change of the company’s supply capacity and the expansion of new fields (peptides, nucleic acids, etc.) and new businesses (preparations, cdmo, etc.). Considering the poor expectation of cdmo business growth elasticity & Sustainability during the revenue structure switching window period, the company maintains the “buy” rating.
Risk tips
Risk of production safety accidents; Risk of shutdown caused by environmental events; Cdmo business order volatility risk; The progress of new drug review is less than expected; Risk of major customer loss, etc.
