Chengdu Kanghua Biological Products Co.Ltd(300841) (300841)
The quantity and price of human diploid crazy seedlings have increased simultaneously, and the performance is expected to increase significantly
The safety and effectiveness of diploid crazy vaccine is higher than that of Vero cell crazy vaccine, which is the global gold standard recognized by who. Only Chengdu Kanghua Biological Products Co.Ltd(300841) has been approved in the Chinese market, which has been in short supply. The performance growth depends on the release of production capacity and price changes. 1) Capacity expansion: before the technical transformation, the company’s capacity of human diploid cell crazy seedlings was 3 million pieces / year. With the production of the second workshop in 2021, the capacity of human diploid cell crazy seedlings has increased to more than 5 million pieces / year. The actual output of each batch is 40000-100000 pieces. The production capacity is declared according to the lower output, and the actual annual output is higher. From January to October 2021, the average batch issuance of human diploid cell crazy seedlings is about 300000 pieces / month, and from November to December, the average batch issuance is about 600000 pieces / month. After the second workshop is put into operation, the annual output is expected to climb to 6-7 million pieces. In 2023, after the projects invested with raised funds are put into operation, the production capacity is expected to further expand to 11 million pieces / year. 2) Bid winning price increase: rabies vaccine is a non immunization planning vaccine, which is priced by enterprises independently, and the provincial CDC is responsible for bidding, which is not affected by the medical insurance policy. In 2021, the bid price of diploid crazy seedlings has increased in nine provinces such as Anhui and Guangdong, with an average price increase of 12%. With the progress of bidding in all provinces, it is expected that the bid price of other provinces is also expected to increase one after another.
Enter the field of pet crazy seedlings and add new growth points of performance
The number of pet dogs and cats in China has exceeded 100 million, and is growing at a rate of 9-10% every year. In 2020, the number of pet crazy seedlings was only 25 million, less than a quarter of the number of pets. Pet policies across the country are becoming stricter. It is expected that pets will need to be vaccinated regularly in the future, which is expected to bring market demand of hundreds of millions of pets. Kanghua strategically arranges the pet rabies vaccine market, acting as the omni-channel general distributor of Hangzhou Youben in Greater China, and combined with the advantages of human vaccine production process, cooperates to produce products with high safety, immunogenicity, immune persistence, controllable quality and accessibility. The company also participated in Guangxi pet biology and obtained the global exclusive agent of its rabies fire extinguishing vaccine (PV / BHK-21 strain). From 2022, Hangzhou Youben’s pet rabies vaccine will begin to sell in large quantities, bringing new performance growth points.
With the combination of autonomy and cooperation, a variety of products are expected to declare or carry out clinical trials
The company adheres to the combination of independent R & D and cooperative R & D, and cooperates with institutions with strong R & D strength such as the Chinese Academy of Sciences and the University of Hong Kong in the early stage of R & D. The company has 10 R & D projects, including hexavalent norovirus vaccine, acyw135 meningococcal conjugate vaccine, tetravalent nasal spray influenza vaccine and human diploid cell crazy vaccine immobilized bioreactor culture process, which is expected to apply for or carry out clinical trials in 2022. In addition, products such as mRNA vaccine and tuberculosis vaccine are also arranged.
Equity incentive shows confidence, and the net profit deducted from non parent company is expected to reach 1.3 billion yuan in 2023
The company has implemented incentives for middle-level managers and core backbones. The performance assessment goal is to take the net profit in 2020 as the base, and the net profit growth rates from 2021 to 2023 are 40%, 108% and 218% respectively, corresponding to the net profit deducted from non parent company from 2021 to 2023 are 564 million, 838 million and 1282 million yuan respectively.
Profit forecast and investment rating: it is estimated that the operating revenue of the company from 2021 to 2023 will be RMB 1.160 billion, 1.890 billion and 3.06 billion, with a year-on-year increase of 11.7%, 62.9% and 61.9%; The net profit after deduction of non parent company was 535.00 yuan (about 240 million yuan without considering the change of fair value of Aibo Biology), 868.00 yuan and 13.31 yuan respectively, with a year-on-year increase of 31.2%, 62.1% and 53.4%, corresponding to 38 / 24 / 15 times of PE from 2021 to 2023. The company’s performance has high growth and the valuation is lower than the industry average. It is given a “buy” rating for the first time.
Risk factors: the risk of product batch issuance falling short of expectations, the risk of intensified market competition, potential risk of product safety, covid-19 epidemic and other uncertain risks.
