\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 196 Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) )
Key investment points
Performance: in line with expectations, innovative products have entered a large-scale period
Performance in 2021: revenue of 39.005 billion yuan (YoY 28.70%), deduction of 3.277 billion yuan (YoY 20.60%), net cash flow from operating activities of 3.949 billion yuan, an increase of 53.07% year-on-year, showing good operating quality. In 2021, the R & D investment was 4.975 billion (YoY 24.28%), which continued to increase the R & D investment, and the performance of listed innovative drugs also accelerated.
By business: the revenue of pharmaceutical sector is 28.904 billion (YoY 32.10%, driven by innovative varieties such as fubitai, hanlikang, hanquyou and Su Kexin), the revenue of medical devices and medical diagnosis sector is 5.938 billion (yoy13.82%, driven by Furui medical technology, yoy82%), and the revenue of medical and health services is 4.118 billion (yoy29.82%). The revenue of the pharmaceutical sector accounted for 74%, and the large volume of core products drove the high growth of the overall revenue end.
Business: the contribution of innovation increment is obvious, and it is optimistic that it will continue to be realized in 2022
① pharmaceutical: innovation and transformation continue to be realized and optimistic. The main contribution of rapid release of mRNA was RMB 28.1 billion in 20204. According to the disclosure of the annual report, we expect that the sales of fubitai may be around 3-3.5 billion in 2021 (according to the analysis of our three quarterly reports, we expect the sales of Q4 to be 1-1.5 billion), and the sales of hanlikang (rituximab injection) will be 1.69 billion (YoY 125.33%); Han trastuzumab (trastuzumab for injection) and Su Kexin (avatripopal maleate) achieved revenue of 930 million yuan and 426 million yuan respectively. The trend of accelerating the volume of innovative varieties is obvious. We expect that the volume trend will continue in 2022, providing support for the high growth of the pharmaceutical sector.
② medical devices and medical diagnosis: it is expected to gradually enter a period of rapid development. The revenue was 5.938 billion yuan (yoy13.82%). Excluding the one-time influencing factors such as the transfer of the distribution right income of “Da Vinci operation Siasun Robot&Automation Co.Ltd(300024) ” in 2021 to the equity transfer income of intuitive Fosun and yanneng biology, the segment revenue increased by 21.25% in the same caliber. Among them, the revenue of Furui medical technology increased significantly, with a year-on-year growth rate of 82% (accounting for nearly 32%) driving the high growth of the revenue of the sector. At present, the company has initially formed three business systems with medical beauty, respiratory health and professional medical treatment as the core, and the three business segments have gradually entered a period of rapid development. Considering the continuous development of China US business of Furui medical and the continuous growth of Da Vinci Siasun Robot&Automation Co.Ltd(300024) operation volume and installed capacity, we expect that the medical device and medical diagnosis sector will still have good growth in the long term.
③ medical and health services: new business investment period, optimistic about medium and long-term realization. The revenue reached 4.118 billion yuan (yoy29.82%), and we expect the high growth to be mainly due to the rapid recovery of business after the end of the epidemic and the low base in 2020. The segment profit is -433 million yuan. We expect that the main reason is that the company continues to increase investment in digital and online business, and is optimistic about the advantages of internet medical system and long-term business development in the future.
Outlook: the inflection point of innovation and transformation continues to be verified, and we are optimistic about the growth from 2022 to 2023
In 2021, the revenue of new and secondary products, including fubitai, hanlikang, hanquyou and Su Kexin, accounted for more than 25% of the revenue in the pharmaceutical business, and the proportion in the group’s revenue also increased rapidly to 18.5%. This verified our judgment that 2020h2 was the inflection point of performance mentioned in our previous report. Both mspd-2 and mspd-2 are expected to be listed with strong growth prospects. With the continuous commercialization of more innovative products in the pharmaceutical sector and the continuous high-volume of innovative drug varieties such as rituximab, trastuzumab, Sully, bevacizumab, avatrapopa and car-t Ikeda, we are optimistic about the growth of the company from 2022 to 2023.
Profit forecast and valuation
We expect the company’s EPS to be 2.14, 2.47 and 2.83 yuan / share from 2022 to 2024. The closing price on March 23, 2022 corresponds to 24 times of PE in 2022 (20 times of PE in 2023), maintaining the “buy” rating.
Risk tips
Risk that the review progress is less than expected; Product sales are less than expected; Market competition risk; The clinical outcome is less than the expected risk; Policy risk.
