\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 63 Porton Pharma Solutions Ltd(300363) )
Key investment points
Event: the company released] 2021 annual report, realizing an operating revenue of 3.1 billion yuan, a year-on-year increase of 49.9%; The net profit attributable to the parent company was 520 million yuan, a year-on-year increase of 61.5%; The net profit attributable to the parent company after deducting non-profit was RMB 500 million, with a year-on-year increase of 74.4%.
Performance continued to grow at a high rate, with significant profit growth and rapid revenue growth. From the profit side, the company’s profit growth is significantly faster than the revenue growth, and the profitability is significantly improved, which is mainly related to the improvement of capacity utilization, the optimization of project structure, the increase of the proportion of high gross profit orders and other reasons. In addition, in 2021, the two new business segments of the company’s preparation cdmo and gene cell therapy cdmo were still in the loss stage, reducing the company’s net profit attributable to the parent company by about 100 million yuan.
Capacity expansion continued to accelerate, laying the foundation for high performance growth. The company’s capacity continued to expand, reaching 2019 cubic meters in 2021. In June 2021, the company’s 109 multi-functional workshop began to be put into operation, with a new capacity of more than 160 cubic meters. In September 2021, the company acquired 70% equity of Hubei Yuyang, with a new capacity of 584 cubic meters. The capacity of the company’s second production base in Jiangxi is also expanding. It is expected to add more than 300 cubic meters of capacity in 2022, laying the foundation for the continuous growth of the company’s performance.
The all-round cdmo platform of “API + Preparation + biological medicine” continues to be promoted, and cdmo for cell and gene therapy is worth looking forward to. Shanghai Zhangjiang R & D Center for cdmo business of preparations has begun to undertake orders in November 2020, and the preparation factory in Liangjiang New Area of Chongqing has also started. At present, the scale of preparation team has reached 156, the number of service customers has reached 24, the number of projects has reached 16, and the amount of newly signed orders has reached 71.13 million. The cdmo business of cell and gene therapy has developed rapidly. The R & D center and clinical production base of Suzhou Tengfei innovation park have been completed and put into use. The team size has reached 294 people. The company has introduced 27 new projects, signed new orders of about 130 million yuan, and the number of orders has continued to grow rapidly. At present, the company has formed cro and “API + Preparation + biological medicine” all-round cdmo platform as a whole. Its R & D strength has been continuously enhanced, and its cdmo business has been continuously upgraded. It is at a new starting point of the comprehensive layout of various businesses, and its long-term development is worth looking forward to.
Profit forecast and investment suggestions. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 1.46 billion yuan, 1.74 billion yuan and 2.2 billion yuan respectively, and EPS will be 268 yuan, 3.20 yuan and 4.04 yuan respectively, corresponding to 35 times, 29 times and 23 times of the current stock price valuation respectively. By strengthening customer expansion and optimizing the revenue structure, the company is expected to continue high growth and maintain the “buy” rating.
Risk warning: the risk of order quantity fluctuation, and the risk that the promotion of preparation cdmo and biological drug cdmo is less than expected
