\u3000\u3 Shengda Resources Co.Ltd(000603) 259 Wuxi Apptec Co.Ltd(603259) )
Event: on March 23, 2022, the company released its annual report for 2021. In 2021, the company achieved a revenue of 22.902 billion yuan, a year-on-year increase of 38.50%; The net profit attributable to the parent company was 5.097 billion yuan, a year-on-year increase of 72.19%; The net profit attributable to the parent company after non deduction was 4.064 billion yuan, a year-on-year increase of 70.38%, and the performance growth was in line with expectations.
Chemical business, testing business, biology business and other businesses grew strongly, with high performance in 2021, and the growth is in line with expectations:
On the revenue side, the company achieved a revenue of 22.902 billion yuan in 2021, a year-on-year increase of 38.50%. Among them, in 2021, chemical business, testing business, biological business, cell and gene therapy ctdmo business and China’s new drug R & D service achieved revenue of 14.087 billion yuan (+ 46.93%), 4.525 billion yuan (+ 38.03%), 1.985 billion yuan (+ 30.05%), 1.026 billion yuan (- 2.79%) and 1.251 billion yuan (+ 17.47%). On the profit side, in 2021, the company realized a net profit attributable to the parent company of 5.097 billion yuan, with a year-on-year increase of 72.19%; The net profit attributable to the parent company after non deduction was 4.064 billion yuan, a year-on-year increase of 70.38%, and the performance growth was in line with expectations.
The chemical business has sufficient reserves and capacity, and the business revenue is expected to nearly double in 2022:
In terms of project reserve, by the end of 2021, 42, 49, 257 and 1318 projects have been approved for listing, phase III clinical, phase II clinical, phase I clinical and preclinical respectively, with obvious pipeline funnel effect.
In terms of production capacity, on the one hand, Changzhou phase II, Taixing, Wuxi oral and sterile filling preparation plants have been put into operation, and the construction of Changzhou phase III, Taixing phase I and Delaware has been accelerated; On the other hand, it completed the acquisition of the factory in kuwei, Switzerland. The company continues to accelerate the construction of production capacity to ensure the timely delivery of the project.
The test business continues to develop rapidly and is expected to continue its rapid growth trend in the future:
The business of SMO / clinical testing and clinical analysis is expected to continue to develop rapidly. Among them, the Asia Pacific leading position of toxicology business is prominent, and its sales increased by 63% year-on-year in 2021; Clinical SMO maintains the leading position in China’s industry. At present, it has a team of 4500 SMO personnel, covering more than 1000 hospitals, and enabling 25 innovative drugs to be approved for listing; Clinical cro continues to develop rapidly. At present, it provides clinical trial development services for 240 projects.
The biology business has the largest discovery biology enabling platform in the world, and is expected to maintain the momentum of rapid development in recent years in the future:
The company has the world’s largest discovery biology enabling platform and more than 2200 experienced scientists to provide customers with a full range of biological services and solutions. The company continued to build biological capabilities related to new molecular types, including oligonucleotides, cancer vaccines, protac, viral vectors, innovative drug delivery systems, and promoted the revenue related to new molecular types and biological drugs to achieve a year-on-year high growth of 75% in 2021.
The ctdmo business pipeline of cell and gene therapy continues to expand, and the revenue growth is expected to exceed the industry growth in the future:
At present, the project pipeline and production capacity of cell and gene therapy ctdmo business continue to expand. It is expected that 2022 will be the turning year of the business, and the revenue growth is expected to exceed the growth rate of the industry. Among them, in terms of project pipeline, there are 58 pre clinical / clinical phase I, 5 clinical phase II and 11 clinical phase III projects respectively, and the funnel effect of project pipeline is becoming more and more obvious; In terms of production capacity, Shanghai Lingang Holdings Co.Ltd(600848) base and Philadelphia base were officially put into operation in October 2021 and November 2021 respectively. After the Philadelphia base was put into operation, the production capacity of high-end cell and gene therapy testing was tripled.
Investment suggestion: we expect the company to realize net profits of 8.334 billion yuan, 10.261 billion yuan and 13.748 billion yuan respectively from 2022 to 2024, with a year-on-year increase of 63.5%, 23.1% and 34.0% respectively; Give an investment rating of buy-a.
Risk tips: the growth of order quantity does not meet expectations, the decline of order price caused by intensified market competition, the lower prosperity of the industry than expected, the risk of overseas policy changes, etc.
