\u3000\u3 Shengda Resources Co.Ltd(000603) 259 Wuxi Apptec Co.Ltd(603259) )
Event: the company released its annual report for 2021, realizing an operating revenue of 22.9 billion yuan, a year-on-year increase of 38.5%; The net profit attributable to the parent company was 5.1 billion yuan, a year-on-year increase of 72.2%; The net profit attributable to the parent company after deduction was 4.06 billion yuan, an increase of 70.4% year-on-year; After adjustment, the net profit attributable to the parent company of non IFRS was 5.131 billion yuan, a year-on-year increase of 41.1%.
High performance growth and continuous improvement of profitability. In the fourth quarter of 2021, the company’s revenue was 6.3 billion, a year-on-year increase of 34%, and the revenue growth rate between quarters increased significantly. The company’s profit growth rate is significantly higher than the revenue growth rate. In addition to the improvement of the profitability of the company’s main business, investment income continues to contribute more performance to the company.
Several major business sectors go hand in hand, and the growth rate of small molecule crdmo business is bright. The company’s chemical business revenue increased by 47% year-on-year, of which the cro business revenue increased by 43.2% year-on-year, and the small molecule cdmo business revenue increased by 50% year-on-year. It is the fastest growing segment among the company’s major business segments. The company expects that the revenue growth of the chemical business segment in 2022 will nearly double that of 2021, which is the core driving force driving the company’s performance growth.
The drug discovery and testing business and biology business maintained rapid growth, and the clinical cro business ushered in a rapid recovery. The growth rate of the company’s small molecule drug discovery and testing business was 39%, which also maintained rapid growth. The growth rate of clinical cro business was 36%, and the company ushered in a rapid recovery after the epidemic. In addition, ddsu business achieved a year-on-year increase of 17.5% and biology business achieved a year-on-year increase of 30%.
Ctdmo business of cell and gene therapy in China grew strongly. In 2021, the company’s cell and gene therapy ctdmo business revenue decreased by 2.8% year-on-year, of which the cell and gene therapy ctdmo business revenue in China increased by 87% year-on-year, effectively alleviating the impact of the decline caused by the delay in the submission of some customers’ listing applications. It is expected that the cell and gene therapy ctdmo will maintain a high-speed growth trend in the future.
Capital expenditure has increased rapidly and has sufficient growth momentum. The company’s capital expenditure reached 6.94 billion yuan in 2021, with a year-on-year increase of more than 100%. The company expects that the capital expenditure is expected to reach 9-10 billion yuan in 2022. The R & D and production bases in many places around the world will be promoted rapidly and synchronously, laying the foundation for sustained and rapid growth of performance.
Profit forecast and rating. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be 7.26 billion yuan, 9.46 billion yuan and 11.72 billion yuan respectively, and the EPS will be 2.46 yuan, 3.20 yuan and 3.96 yuan respectively, corresponding to the current stock price valuation of 45 times, 34 times and 28 times respectively, maintaining the “buy” rating.
Risk tip: the order is less than expected, and the extension expansion is less than expected.
