\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 47 Hangzhou Tigermed Consulting Co.Ltd(300347) )
Matters:
The company released its annual report for 2021. The annual revenue was 5.214 billion yuan (+ 63.32%), the attributable net profit was 2.874 billion yuan (+ 64.26%), and the attributable net profit after deduction was 1.232 billion yuan (+ 73.90%). Dividend plan: 5.00 yuan (including tax) for every 10 shares.
Ping An View:
The impact of Q4 epidemic was significantly less than that of the same period of last year, and the performance recovered significantly
The change of the epidemic has caused the uncertainty of the company's business development rhythm. Compared with the same period of last year, the epidemic situation in 2021q4 has been well controlled, and the company's business has also improved rapidly. In 2021q4, the company achieved a revenue of 1.819 billion yuan (+ 103.91%) and a net profit of 363 million yuan (+ 72.19%). During Q4, the company paid a lot of handling fees for covid-19 related clinical trials. The superposition of exchange rate factors led to higher revenue growth than profit growth, and the gross profit margin in the quarter was 37.55% (-7.17pp).
In terms of clinical trials and technology, the company has accelerated the pace of clinical trials (+ 9.405 billion yuan), and the revenue of vid-2.905 billion yuan has also been greatly improved. The revenue of clinical trial related services and laboratory services was 2.194 billion yuan (+ 32.39%), and the data system and preclinical research business were less affected by the epidemic, and continued to achieve rapid development.
With abundant orders on hand, Matthew effect helps the development of the company
During the period of rapid promotion of clinical R & D of new drugs, the company's contract amount reached 19.9-74 billion yuan, with a rapid recovery of vid of 2021.4%. By the end of the year, the amount of contracts to be executed by the company was RMB 11.405 billion (+ 57.09%), laying a foundation for the growth of subsequent years.
Affected by the new deal of CDE and financing, the trend of sustained and rapid growth in the number of early new drug development in China may change. However, we believe that most of the projects that may be shelved due to the impact of policies are not innovative and unique, and their clinical value is relatively limited. As the absolute leader of clinical cro in China, the company rarely undertakes such repeated construction projects with low added value. Under the Matthew effect, even if the total amount of new drug research and development stops, its marginal impact will be mainly reflected in small-scale enterprises with limited capacity.
Business globalization is an inevitable trend, and the company continues to promote the project to sea
In recent years, new drug research and development has shown a significant trend of globalization. As a link of new drug innovation, CXO is also experiencing globalization rapidly. The globalization of clinical cro is mainly reflected in the development of overseas business, including two paths: undertaking orders from overseas pharmaceutical enterprises and following the products of Chinese pharmaceutical enterprises abroad. At the current time point, going to sea with Chinese pharmaceutical enterprises is the main way of clinical cro globalization.
Tiger has a forward-looking vision in the global layout and has built overseas clinical centers in the United States, South Korea, Australia and other countries for a long time. When the trend of globalization comes, companies can act quickly. In 2021, the company carried out 132 (+ 37) single regional clinical trials and 50 (+ 30) multi center clinical trials overseas. The global operation ability of the company's team has been fully proved. In view of the company's leading ability to achieve business globalization, we are confident that the company will continue to maintain its advantages in the medium and long term.
Maintain a "recommended" rating. The company is a leading clinical cro enterprise in China. Its business scale and capacity significantly surpass other Chinese peers, and its industry position is stable. After the function of the clinical center was restored, the company's business recovered significantly and achieved rapid growth. New drug innovation is moving towards globalization and is optimistic about the development prospect of the company's business at sea. Considering the development of the epidemic and the change of the company's share capital, adjust and add the EPS of 4.28, 5.17 and 6.43 yuan from 2022 to 2024 (the original EPS of 2.68 and 3.30 yuan from 2022 to 2023, excluding the change of fair value), and maintain the "recommended" rating.
Risk tips: 1) there are fluctuations and uncertainties in new drug research and development, which may cause fluctuations in the company's performance; 2) If the service quality provided by the company fails to meet the requirements, it may lead to rework, loss of orders, etc; 3) The company distributes its business around the world through mergers and acquisitions. If the integration is not smooth, it may have a negative impact on the company's long-term development.
