\u3000\u30 Shenzhen Zhenye(Group)Co.Ltd(000006) 61 Changchun High And New Technology Industries (Group) Inc(000661) )
Event: the company released its annual report for 2021. During the reporting period, it realized an operating revenue of 10.747 billion yuan, a year-on-year increase of 25.30%; The net profit attributable to the parent company was 3.757 billion yuan, a year-on-year increase of 23.33%; The net profit attributable to the parent company after deduction was 3.742 billion yuan, a year-on-year increase of 26.76%
Growth hormone maintains high-speed growth, and the short-term market pattern after centralized mining in Guangdong is expected to remain unchanged. During the reporting period, the subsidiary kinsay pharmaceutical achieved a revenue of 8.198 billion yuan, a year-on-year increase of 41.27%; The net profit was 3.757 billion yuan, a year-on-year increase of 36.12%.
Growth hormone market scale: at present, China’s growth hormone market is still in the stage of rapid growth. According to the data of PDB sample hospitals, the sales of China’s growth hormone sample hospitals in the first three quarters of 2021 alone reached 86% of the total sales in 2020, about 84% of that in 2019, indicating that the whole China’s growth hormone market has gradually stepped out of the impact of the epidemic and is expected to continue to grow in the future.
Market share: at present, the share of Kinsey pharmaceutical in China’s growth hormone market has been basically stable, and it is expected to benefit from the overall growth of the market or further expand the market share through long-term growth hormone in the future. According to the data of PDB sample hospitals, the growth hormone market share of kinsay pharmaceutical reached 76% in the first three quarters of 2021, which was consistent with that in 2020 and higher than 72.5% in 2019. As there is no growth hormone water injection winning the bid in this centralized mining in Guangdong, considering that water injection is the main source of income of Kinsey pharmaceutical, we expect that this centralized mining will have little impact on the company’s future revenue, and the market pattern of growth hormone is expected to continue to maintain the dominant pattern of Kinsey in the short term, and its long-term development prospect is worth looking forward to.
Future growth points: we believe that the future growth of growth hormone will mainly come from the expansion of the whole market driven by the improvement of penetration, the active expansion of the adult indication market of growth hormone, and the effective expansion of the high-value long-term growth hormone market.
R & D expenses increased significantly, multi-channel layout improved product line layout in strategic areas. In 2021, the company’s R & D expenses increased significantly, reaching 885 million yuan, with a year-on-year increase of 86.37%, showing the company’s determination to seek innovation and development. On the other hand, the company has gradually improved the product line layout in the strategic field through various channels, further widened the company’s business structure, and is expected to continue to improve the company’s core competitiveness in the future, including: (1) introducing the Chinese rights and interests of LVYE pharmaceutical lismin patch, expanding the company’s influence in the field of psychotropic drugs and anti-aging treatment; (2) It is planned to acquire 68% equity of wowei medical to lay out the neonatal field; Focusing on the field of brain diseases and brain intellectual development, Hangzhou wowei medical mainly focuses on the registration and development of neonatal and adult brain function monitoring equipment. This acquisition is expected to further expand the layout of the company in the field of newborns; (3) It is proposed to acquire a total of 51% equity of Chun’an biology in the form of capital increase and share expansion in three stages. After this investment, we can make full use of the existing molecular coupling technology platform of Chun’an biology to develop new products in line with the company’s strategy. At the same time, it is conducive to broaden the company’s business structure and enable the company to quickly enter the field of senile bone and joint diseases and dermatology.
Investment suggestion: we expect the revenue growth rate of the company from 2022 to 2024 to be 27.24%, 26.92% and 26.11% respectively, the net profit growth rate to be 25.45%, 25.39% and 25.09% respectively, the corresponding EPS to be 11.65 yuan, 14.60 yuan and 18.27 yuan respectively, and the corresponding PE to be 15.1 times, 12.1 times and 9.6 times respectively; Maintain the investment rating of buy-a.
Risk tips: the risk of intensified competition in the growth hormone market, the risk of intensive collection of growth hormone, the risk that the progress of clinical trials of innovative drugs is less than expected, and the risk of clinical trials failure.
