Zhejiangtailin Bioengineering Co.Ltd(300813) (300813)
Report guide
We believe that CGT related equipment drives the company's medium and short-term revenue growth, and gradual & integrated product upgrading is the main logic of the company's growth. The steady growth of detection / isolation / sterilization products is expected to provide stock cash flow, and the company is rated as "overweight" for the first time.
Key investment points
Zhejiangtailin Bioengineering Co.Ltd(300813) : cell equipment upgrade, growth kinetic energy switching
Benefiting from the boom of downstream CGT capital expenditure, we believe that the compound growth rate of the company's cell preparation / sub packaging workstation business revenue is expected to reach 100% + from 2022 to 2024, driving the overall revenue growth CAGR at about 35%. ① Business composition: the company's Incubator (accounting for about 30-35% of revenue in 2016-2020, the same below), sterile isolator (accounting for 25-30%), VHP sterilizer & TOC analyzer (the sum of the two accounts for 15-20%) the sales proportion is relatively high. In 2020, the company's cell preparation / sub packaging workstation accounts for about 1.9% of the total revenue. We expect that the revenue proportion of cell preparation / sub packaging workstation is expected to reach more than 10% from 2022 to 2024.
② Growth trend of stock business: we believe that the market growth of microbial detection and sterilization equipment (incubator, sterilizer, analyzer, etc.) is steady, competitors are scattered, and the company has certain technical advantages and sales foundation in this field. We expect to maintain steady growth.
③ Growth trend of new business: the balance of contract liabilities in the third quarterly report of 2021 is nearly 79 million yuan, which is mainly contributed by isolator series products. General equipment companies are included in contract liabilities when 30% of the order payment is not delivered. From the trend of contract liabilities and the trend of industrial capital expenditure, we expect that the revenue of cell preparation / sub packaging workstation from 2022 to 2024 is expected to maintain a high growth rate.
Industry: driven by CGT R & D + closed aseptic supervision
① Clinical & Sales: mainly pipeline in early stage, accounting for a high proportion in China. We expect that the global car-t product sales will be about US $1.5-2 billion in 2021. The number of car-t clinical phase I and phase II projects in China will grow rapidly from 2019 to 2020. We expect that the R & D capacity construction of early projects will be the main body of capital expenditure of CGT projects in China at this stage.
② Equipment & Environment: closure & automation is the trend, and isolation system is the alternative. From the perspective of EIA, the equipment demand of capital expenditure & brand preference, The proportion of isolator / cell workstation is very low (only 2-3 times in 30 + cases), and R & D equipment prefers overseas manufacturers such as semefi. The global survey shows that only 9% of CGT production adopts isolator + C / D environment. We believe that cell workstation is essentially an isolator system for closed and sterile R & D / production of CGT products, which is in line with the direction of GMP supervision and is expected to reduce costs (closed automatic production is expected to reduce the production cost by 37%), instead of the widely used "clean room + biosafety cabinet" Open system. In R & D capacity construction, cost is not the key to equipment selection, and the total demand for production equipment is relatively low. We believe that with the increase of commercial pipelines, GMP strengthening the supervision of sterile closed environment, the proportion of isolation systems such as cell workstations is expected to increase.
③ Demand estimation: the equipment demand is expected to reach 650-700 sets / year in 2023. Assuming that 100% of the incremental investment adopts cell workstation, the corresponding total market capacity is about 10-11.5 billion yuan (refer to the unit price of 1.6 million yuan / set estimated in Zhejiangtailin Bioengineering Co.Ltd(300813) in the announcement); assuming that about 1 / 3 adopts cell workstation, the corresponding total market capacity is 3-4 billion yuan.
Company: Integrated & progressive product upgrading
Marginal change: product upgrading may be the biggest change of the company from 2022 to 2024. ① The proportion of revenue from high unit price products increased, and the proportion of "Isolation Technology Series" products with an average unit price of 350000-400000 yuan / set increased, In addition, the proportion of products (cell preparation / sub packaging workstation) with a price of 1.5 million yuan / set in this series has further increased, reflecting the upgrading of the company's integrated and modular technology in the field of gene cell therapy production. ② new customers and new products drive the overall revenue growth: according to the company's announcement, as of April 2021, "the issuer has accumulated with Yao Ming Juno, Shanghai Pharmaceuticals Holding Co.Ltd(601607) , Bgi Genomics Co.Ltd(300676) 、 Shanghai bangyao biology and other 17 cell therapy customers have signed a number of supply contracts for related products (including 19 cell preparation workstations and 10 cell aseptic sub packaging workstations), of which the total contract amount of delivered products has exceeded 21 million yuan (26 in total), and the amount of undelivered products is about 3.8 million yuan (3 sets in total), while the relevant revenue in 2020 is only 3.8 million yuan. We are optimistic about the rapid growth trend of the company's cell preparation / sub packaging workstation products.
Capacity preparation: from 2021 to 2023, the capacity will increase, and the production will accelerate after 2024. The company's convertible bond project plans to raise 300 million yuan, the construction period is 36 months, and will gradually reach the production capacity within 4 years after completion. Assuming that the construction is started in 2022, we expect to start gradually from 2024 to 2025, and the total output value of cell therapy equipment corresponding to the new production capacity is about 663 million yuan, Even considering the potential price reduction competition (assuming a price reduction of 30-50%), the income CAGR of cell therapy related equipment is expected to reach 70% + after it is put into operation. From the rhythm, from 2021 to 2023, we pay attention to the company's capacity growth through technical transformation, production scheduling adjustment and other factors. After 2024, we pay attention to the production progress of newly raised products and the growth of industry demand brought by the commercialization of cell therapy products.
Other business segments: laboratory consumables, microbial testing and sterilization products, supported by the demand side, and expected revenue to maintain steady growth.
Profit forecast and valuation
We expect the company to achieve operating revenue of 270 million yuan, 350 million yuan and 480 million yuan from 2021 to 2023, with a year-on-year increase of 33%, 33% and 37%; The net profit attributable to the parent company was 70 million yuan, 90 million yuan and 120 million yuan, with a year-on-year increase of 36%, 34% and 36%. The corresponding EPS is 1.27, 1.71 and 2.32 yuan / share respectively. The closing price on December 24, 2021 corresponds to 73 times PE in 2021 and 54 times PE in 2022, which is higher than the average value of comparable companies, We think it may reflect the market's valuation premium on the company's high growth business segments (such as cell preparation / sub packaging workstation and other equipment). We believe that CGT related equipment is expected to drive the company's medium and short-term performance growth, gradual & integrated product upgrading is the main logic of the company's growth, and the steady growth of stock detection, isolation and sterilization products is expected to provide cash flow for the first time "Overweight" rating.
Risk statement
Order delivery periodicity & volatility risk, price reduction risk caused by fierce market competition, risk that the promotion progress of new products is less than expected, risk that the speed of capacity construction is lower than expected, etc.
