Huadong Medicine Co.Ltd(000963) (000963)
Key investment points
China, the United States and East China plan to acquire 100% equity of Huachang high tech to help the layout of the industrial microbiology sector.
Huadong Medicine Co.Ltd(000963) a wholly-owned subsidiary, Sino US East China, simulated the acquisition of Huachang high tech in order to expand the industrialization of industrial microbiology. 1) Subject matter: Huachang high tech is mainly engaged in the R & D and production of pharmaceutical intermediates and special chemicals. The idle resources have high revitalization potential. The company has not carried out business activities since 2020. Due to its inability to pay off its due debts and obvious lack of solvency, it was ruled as bankruptcy reorganization according to law on January 21, 21, 2001. 2) Capital increase: China, the United States and East China increased the capital of Huachang high tech with their own funds / self raised funds of 108 million yuan, and acquired 100% of the shares held by the original shareholders. The amount of capital increase is used to pay bankruptcy expenses, pay off mutual benefit debts and bankruptcy bonds. 3) Post transaction plan: China, the United States and East China plan to complete the trial production of Huachang high tech by the end of March 2022, reasonably plan its production line and public system, and make new investment to activate production capacity and introduce new products.
The company will build Huachang high tech into a new industrialization platform in the field of industrial microbiology and a main production base of nucleoside products.
Nucleoside products are important raw materials for covid-19 virus detection and treatment, and have broad market prospects. Nucleoside products are widely used in the development and production of mRNA vaccines and drugs, oligonucleotide drugs, antiviral drugs and nucleic acid in vitro detection reagents. The global market is developing rapidly and has broad market prospects.
Huachang high tech, located in the organic synthesis base of fine industry in Anhui Province, is a national high-tech enterprise with regional advantages and pharmaceutical R & D and production experience. After the acquisition of Huachang high tech, the company will combine the advantages of enterprise management, production R & D and market expansion in China, the United States and East China, revitalize the existing idle resources of Huachang high tech, and build it into a 1) full Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) platform in the field of industrial microbiology: focus on the industrialization of nucleoside series products, microbial semi synthetic antiparasitic drugs and other drugs. Based on the existing production facilities of Huachang high tech, the company will transform it into a production base of high-end characteristic pharmaceutical APIs, intermediates and special functional chemicals in line with international standards; 2) Main production base of nucleoside products: the company will implement relevant product pipelines such as modified, protective nucleosides and triphosphorylated nucleosides, further expand commercial nucleoside variety projects and expand the production scale of nucleoside products.
Seize the development opportunity of industrial microorganisms and vertically expand the scale production capacity of industrial microorganisms.
The company expects to build “industrialization, scale and internationalization” in the field of industrial microbiology “Industrial cluster, develop a new blue ocean of microbial industry. The company has previously arranged Meiqi health and Hunda biology. This transaction is another strong layout for the company to integrate into the global industrial microbial pharmaceutical innovation and R & D industrial chain. 1) Meiqi health microbial great health industry platform: established in November 21, positioning the R & D, production and sales of microbial great health products; 2) Hunda biological industry Innovation and R & D platform for microbial industry: focus on the development of high technical barriers and high value-added microbial products. Based on synthetic biology and multi-scale microbial metabolic regulation technology, a system platform for microbial construction, metabolite expression, purification and modification has been formed. In the field of nucleosides, there are a series of R & D pipelines for fermentation basic nucleosides, enzyme transformed nucleosides, modified nucleosides, protective nucleosides and triphosphorylated nucleosides; 3) Huachang high tech Industrial Microbiology industrialization platform: the main production base of nucleoside products. Further promote the company’s integration into the global industrial microbial pharmaceutical innovation and R & D industrial chain.
Profit forecast and valuation
The company has actively distributed the three major sectors of pharmaceutical industry, pharmaceutical commerce and medical beauty business, and has developed into a large comprehensive pharmaceutical company integrating pharmaceutical R & D, production and distribution. With the launch of maiden needle, F0 and other medical beauty products, the company’s new medical beauty business is expected to bring a new growth curve. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be RMB 2.52 billion, RMB 3.1 billion and RMB 3.81 billion respectively, with growth rates of – 10.5%, 22.7% and 23.0% respectively, corresponding to PE of 28, 23 and 18x respectively, maintaining the buy rating.
Risk statement
The risk of intensified market competition, the risk that the product registration approval document cannot be approved, the risk of new drug R & D, the risk of strategic mistakes of the company, the low proportion of medical and American business, and there is some uncertainty.
