\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 422 Kpc Pharmaceuticals Inc(600422) )
Matters:
The company released its 2021 annual report, realizing a revenue of 8.254 billion yuan, a year-on-year increase of 6.95%; The net profit attributable to the parent company was 508 million yuan, a year-on-year increase of 11.12%; The net profit attributable to the parent company after deduction was 280 million yuan, a year-on-year decrease of 15.13%; EPS is 0.67 yuan. The company’s performance was slightly lower than previously expected. The profit distribution plan for 2021 is 2.7 yuan (including tax) for every 10 shares. In 2021q4, the revenue in a single quarter was 2.226 billion yuan, a year-on-year decrease of 2.93%; The net profit attributable to the parent company was 73.8 million yuan, a year-on-year decrease of 30.28%; The net profit attributable to the parent company after non deduction was 21.95 million yuan, a year-on-year decrease of 47.72%.
Ping An View:
The income structure was further adjusted and the gross profit margin increased rapidly. In 2021, the company realized a revenue of 8.254 billion yuan (+ 6.95%), a net profit attributable to the parent company of 508 million yuan (+ 11.12%), and a net profit attributable to the parent company of 280 million yuan (- 15.13%) after deducting non profits. The company’s performance was slightly lower than previously expected. We believe that the growth rate of net profit attributable to the parent company after deducting non profits is lower than that of revenue, which is mainly due to the adjustment of the company’s revenue structure and the continuous decline of injection revenue and proportion with higher gross profit margin. In 2021, the proportion of injection revenue decreased to 10.30% (- 5.79pp). The adjustment of revenue structure also led to a further decline in the company’s gross profit margin. In 2021, the company’s overall gross profit margin was 41.30% (-2.54pp), and the net profit margin after deduction was 3.39% (-0.88pp). By industry, the gross profit margin of oral agents reached 75.82% (+ 5.64pp), mainly due to the rapid increase of scale; The gross profit margin of injection is 84.54% (- 6.58pp), which is mainly affected by the price reduction of centralized purchase in various places.
Xuesaitong oral + Kun traditional Chinese medicine rapid volume, the injection is expected to hit the bottom and pick up. In 2021, the company will continue to focus on Xuesaitong oral + Kunming traditional Chinese medicine as the breakthrough direction. Among them, Xuesaitong oral revenue is 948 million yuan (+ 18.80%), of which blood soft revenue is 593 million yuan (+ 28.28%). By building a professional brand in the field of stroke prevention and treatment, we believe that blood soft is expected to grow into a large variety of more than 1 billion yuan. Kunming traditional Chinese medicine has a revenue of 1.212 billion yuan (+ 19.97%) and a net profit of 90.37 million yuan (+ 47.59%). Through the establishment of the high-quality national medicine brand of “Kunming traditional Chinese medicine 1381”, Kunming traditional Chinese medicine is expected to rank among the first-line and time-honored brands of Chinese traditional medicine and become a “Chinese Jincun”. In 2021, Medicare will untie Xuesaitong and gastrodin injections. We believe that the rebound of injections in 2022 is also expected to contribute considerable profit elasticity. Becknowton strives to build a professional business platform in the field of bone wind and kidney, with a revenue of 594 million yuan (+ 7.42%) and a net profit attributable to the parent company of 40.43 million yuan (+ 16.63%). The commercial sector maintained steady growth, with a revenue of 4.265 billion yuan (+ 6.30%), and a net profit attributable to the parent company of 36.5 million yuan (+ 9.55%).
The oral series continued to grow at a high rate, the contribution of injections was flexible, and the “recommended” rating was maintained. On the whole, Xuesaitong oral and Kunming traditional Chinese medicine are expected to maintain a rapid development momentum in 2022, and the profit margin is expected to continue to improve with the increase of scale. The injection is expected to hit the bottom and rebound under the background of the deregulation of medical insurance and the winning of centralized procurement of Xuesaitong Hubei alliance. Considering that the company’s performance in 2021 is lower than expected and the impact of non recurring earnings on net profit in 2022 is weakened, we adjusted the forecast of net profit attributable to parent company from 2022 to 2023 to 579 million and 662 million yuan (originally predicted to be 663 million and 787 million yuan). Meanwhile, it is estimated that the net profit attributable to parent company in 2024 will be 792 million yuan, corresponding to EPS of 0.76 yuan, 0.87 yuan and 1.05 yuan from 2022 to 2024 respectively. The current stock price will be 15.1 times that of PE in 2022, maintaining the “recommended” rating.
Risk tips: 1) market and policy risks: medical insurance fee control is still the main theme of the pharmaceutical industry, there is the possibility of centralized purchase of the company’s core products, and there may be some uncertainty about the rebound of injections; 2) Drug R & D is less than expected: at present, the company has many varieties under research, and the R & D progress may be less than expected; 3) Impact of the epidemic on the company’s operation: the recurrence of the national epidemic in early 2022 may have an adverse impact on the company’s annual performance.
