\u3000\u30 Shenzhen Quanxinhao Co.Ltd(000007) 39 Apeloa Pharmaceutical Co.Ltd(000739) )
Events
On March 9, Apeloa Pharmaceutical Co.Ltd(000739) released the 2021 annual report. The company achieved an operating revenue of 8.943 billion yuan in 2021, an increase of 13.49% year-on-year; The net profit attributable to the parent company was 956 million yuan, a year-on-year increase of 17%; The net profit attributable to the parent company after deduction was 833 million yuan, a year-on-year increase of 20.53%. The performance slightly exceeded expectations.
Brief comment
Cdmo business performed well, and API and preparation business grew steadily. In terms of business, the API and intermediate business achieved an operating revenue of 6.546 billion yuan, a year-on-year increase of 10.37% and a gross profit margin of 19.15%; Cdmo business achieved an operating revenue of 1.394 billion yuan, a year-on-year increase of 32.09%, and the gross profit margin was 43.12%, an increase of 1.50pct; The preparation business achieved an operating revenue of 867 million yuan, a year-on-year increase of 14.11%, and the gross profit margin was 57.42%, a year-on-year decrease of 0.21 PCT.
Continue to increase R & D investment and continuously improve technical strength. The company always adheres to high-quality development driven by scientific and technological innovation. In 2021, the cumulative R & D investment was 479 million yuan, a year-on-year increase of 34.88%, accounting for 5.36% of revenue, reaching a record high. In addition, the company has accelerated the construction of three technical platforms: fluid chemistry, crystal and powder, synthetic biology and enzyme catalysis. Among them, the fluid chemistry platform has realized the implementation and commercial production of multiple continuous projects, so as to further create the core competitive advantage in R & D and manufacturing.
Cdmo production capacity landing + API preparation integration, the company has a strong driving force for long-term development. The company’s cdmo business is synchronously arranged in the field of veterinary medicine and human medicine, and maintains long-term good cooperative relations with Merck and other leading pharmaceutical enterprises. In the future, with the gradual implementation of the production capacity in the early layout, there is a large room for performance growth. In addition, centralized procurement is gradually normalized. We are optimistic about the company’s API and preparation integration strategy, which is expected to achieve rapid and large-scale production with the help of centralized procurement, with strong medium and long-term development momentum.
Investment advice
Taking into account the price rise of upstream raw materials and other factors, we give EPS of 1.02/1.33/1.63 yuan from 2022 to 2024 (down 9.87% and 8.81% respectively from 2022 to 2023), and the corresponding PE is 31 / 24 / 20 times respectively, maintaining the “buy” rating.
Risk tips
Covid-19 epidemic recurrence risk; Upstream raw material price rise risk; Downside risk of API price; New drug research and development is less than expected risk; Environmental protection and quality risks; exchange-rate risks; The risk of sales decline caused by drugs being transferred out of the medical insurance catalogue; Management’s risk of reducing holdings, etc.
