Focused Photonics (Hangzhou) Inc(300203) (300203)
Event: on December 24, the 32nd meeting of the Standing Committee of the 13th National People’s Congress of the people’s Republic of China revised and adopted the science and technology progress law of the people’s Republic of China (Science and technology progress law).
The state vigorously promotes the procurement of domestic instruments, and the leader of domestic analytical instruments will benefit
The state vigorously promotes the procurement of domestic instruments. Article 91 of the law on the progress of science and technology clearly states that: 1) for scientific and technological innovative products and services, government procurement should be purchased under the condition that the function, quality and other indicators can meet the needs of government procurement; 2) If it is put on the market for the first time, government procurement shall be the first to purchase, and shall not be restricted on the basis of commercial performance; 3) Products purchased by the government that have yet to be researched and developed shall be implemented by ordering. As the leader of domestic high-end analytical instruments, the company’s products are gradually spreading into various market segments and are expected to continue to benefit.
A number of policies continued to increase, and the environment for domestic scientific instruments gradually improved
The national level attaches importance to the development of relevant scientific research instruments and has repeatedly put forward relevant development opinions in recent years to solve the problem of “neck sticking” of high-end analytical instruments. The environment of domestic high-end analytical instruments is gradually improving. Taking the mass spectrometer as an example, according to the data of Zhiyan consulting and the General Administration of customs, the market scale of China’s mass spectrometer in 2020 was about 14.2 billion yuan, including 10.5 billion yuan of imported mass spectrometer, with a localization rate of about 26%, significantly higher than the localization rate of 5% / 15% in 2014 / 2018.
The company is the leader of domestic analytical instruments and expands the layout of life sciences. Domestic substitution is expected to increase the market share. As the leader of domestic analytical instruments, the company actively cuts into the fields of life sciences and semiconductors, and the original market space is expected to increase from 40 billion to 100 billion in the field of environmental monitoring. The company’s growth path is benchmarked to overseas giants Thermo Fisher and Danaher. In recent 20 years, the company has continued to increase its weight at the R & D end, and its technology continues to lead its Chinese peers. With the expansion of downstream fields, domestic substitution and the further improvement of the concentration of domestic instrument industry, the market share still has great room for improvement.
Organize a special team to dispose of the divested PPP project, and the operation is expected to improve gradually in the future
In the third quarterly report of 2021, the company proposed to dispose of the divestiture PPP project for the first time, which is currently being promoted. In the first three quarters of 2021, the company’s long-term accounts receivable were nearly 2.1 billion yuan, mainly affected by PPP projects. In order to concentrate the company’s resources and optimize the asset liability structure, the company plans to dispose of historical PPP projects with light equipment, and its operation is expected to improve gradually in the future.
Profit forecast
At present, the company is still in the R & D investment period. The R & D expenditure of the company in the first three quarters was 410 million yuan, accounting for about 20% of the company’s revenue. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 140 / 3.5 / 450 million respectively, with a year-on-year increase of – 72% / 153% / 28%, corresponding to P / E104 / 41 / 32x. As the leader of domestic analytical instruments, the company actively distributes the life sciences, clinical and medical fields and maintains the “overweight” rating of the company.
Risk statement
1) The layout of the life science sector was not as expected; 2) The competition pattern of the original business market intensified and the gross profit margin decreased
