\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 63 Porton Pharma Solutions Ltd(300363) )
Event summary
Event 1: the company released its annual report for 2021 on March 25: the operating revenue was 3.105 billion yuan, a year-on-year increase of 50%; The net profit attributable to the parent company was 524 million yuan, a year-on-year increase of 61%; Deduct the net profit not attributable to the parent company of 503 million yuan, with a year-on-year increase of 74%; The gross profit margin and net profit margin were 41.36% and 15.32% respectively, unchanged from the same period last year; The expense rate during the period was 20.89%, with a year-on-year decrease of 3.47pp; The total number of employees reached 3782, a year-on-year increase of about 44%.
Event 2: the company released the first quarter performance forecast on March 25: the operating revenue was 1.357-1.466 billion yuan, a year-on-year increase of 150% - 170%; The net profit attributable to the parent company was RMB 326344 million, with a year-on-year increase of 270% - 290%; The net profit deducted from non parent company is RMB 324339 million, with a year-on-year increase of 330% - 350%. The high growth rate of performance is mainly due to the high outlook of cdmo industry and the continuous expansion of company customers / product pipelines. In 2022, Q1 company's on hand orders increased strongly, and early orders were delivered successively, opening up the high growth track.
Key investment points
API cdmo: the collaboration between front and back-end businesses is strengthened, and the expansion of production capacity contributes to the stable release of performance
The company's API cdmo sector continued to improve the depth and breadth of customer coverage, achieved rapid growth in revenue, and achieved revenue of 3.069 billion yuan in 2021, a year-on-year increase of 51%; It has served 181 Chinese customers (+ 51) and 84 J-star customers (+ 26); In 2021, there were 369 service projects, including 42 clinical phase III projects and 89 new drug application and marketing projects; The diversion effect of the project has gradually appeared, a total of 20 projects have entered the next development stage, and 2 innovative drugs have been approved for marketing; In 2021, J-star achieved a revenue of 230 million yuan, an increase of 8% year-on-year, draining 60 projects, and further strengthening the synergy of business outside China. Product upgrading was gradually promoted, and 105 API products achieved a total revenue of 290 million yuan, a year-on-year increase of 55%. In 2021, Changshou 109 workshop and Yuyang were put into operation successively, and the production capacity was expanded to 2019m3, with a year-on-year increase of about 65%. The rapid expansion of production capacity provided sufficient guarantee for the rapid growth of subsequent performance.
Preparation cdmo: the preparation platform is completed to create an integrated service pattern of "intermediate + API + Preparation"
The company officially launched the "API + Preparation" collaborative service in 2021, and the preparation cdmo business achieved a breakthrough of "from 0 to 1". The cdmo segment of preparations achieved a revenue of 2016 million yuan in 2021; It has served 24 Chinese customers (+ 23); There are 28 service projects, including 18 clinical phase II and previous projects, 2 clinical phase III projects, and 8 new drug application and marketing projects; There are 31 projects under research, including 15 innovative drugs and 16 generic drugs, with a total order amount of 71.13 million yuan. A total of 13 collaborative projects of "API + Preparation" are superimposed on the phase I project of preparation production base in Liangjiang New Area, Chongqing, which is planned to be put into operation in the fourth quarter of 2022, so as to expand the preparation cdmo business capacity circle and further open up the end-to-end cdmo service chain of "DS + DP".
Gene cell therapy cdmo: strategic layout in all fields, providing all-round end-to-end services
The CGT cdmo sector of the company has built cutting-edge cdmo platforms such as plasmid, cell therapy, oncolytic virus, nucleic acid therapy and live bacteria therapy, providing full-dimensional end-to-end services from database building to preparation canning. In 2021, the company achieved a revenue of 13.87 million yuan, a year-on-year increase of 897%; 17 Chinese customers (+ 15) in total; In 2021, 18 clinical phase I and previous projects will be served; In terms of AAV virus packaging, car-t cell ind production and other aspects, 27 new projects were introduced, and the newly signed orders were about 130 million yuan. The company continued to expand its talent team and production capacity. In terms of talents, the total number of employees in the sector reached 294 in 2021, a year-on-year increase of 216%; In terms of production capacity, with the 16000 ㎡ industrialization platform in Suzhou Sangtian Island put into operation, the gene therapy process development, analysis and testing and GMP production capacity will be further enhanced.
Profit forecast
The three business segments of the company continue to make efforts to promote the rapid growth of performance. We expect the operating revenue of the company to be RMB 7.776/89.08/10.731 billion from 2022 to 2024 (compared with RMB 4.554/5.257 billion from 2022 to 2023); The net profit attributable to the parent company was 1.342/1.560/1.907 billion yuan (originally 764913 million yuan from 2022 to 2023); The corresponding EPS is 2.47/2.87/3.50 yuan / share (originally 1.40/1.68 yuan / share from 2022 to 2023), maintaining the buy rating.
Risk warning: the R & D Progress of the innovative drugs served is less than the expected risk; Risk of demand fluctuation in the end market of commercial projects; Investment risk of fixed assets; Exchange rate fluctuation risk; Environmental protection and safety risks; New business investment risk; The first quarter performance forecast is the preliminary accounting, and the specific financial data shall be subject to the official report disclosed by the company
