\u3000\u30 Beijing Zznode Technologies Co.Ltd(003007) 59 Pharmaron Beijing Co.Ltd(300759) )
4q21 revenue and adjusted net profit increased by 38% / 37% respectively (previously released performance express), but the gross profit margin fell by 2.1pcts due to the change of RMB exchange rate, lower than expected. In the next step, the company will focus on the construction of infrastructure (self construction + extension M & A) and new technology platform of each business line. Maintain the “buy” rating, but considering the uncertainty of short-term performance under the contraction of sector valuation and acquisition expansion, reduce the target price of A-Shares / H shares to 178.4 yuan / 172.1 Hong Kong dollars.
Performance in 2021: the annual revenue increased by 45% year-on-year to RMB 7.44 billion, of which overseas customers contributed 83% (2020: 86%). Net profit attributable to parent company / adjusted net profit increased by 42% / 37% year-on-year to RMB 1.66 billion / 1.46 billion. The gross profit margin of main business decreased by 1.4pcts to 36.0%; If calculated at the exchange rate of the same period last year, the revenue increased by 52% and the gross profit margin increased by 1.4 percentage points to 38.8%. 4q21 revenue and adjusted net profit increased by 38% / 37% year-on-year (3Q: 45% / 20%), and the gross profit margin of main business decreased by 2.1pcts to 34.7%. The management raised the growth guidance of revenue and net profit in 2022 to 30-40%. 2021 performance by business line:
The laboratory service revenue increased by 41.1% to 4.57 billion, and the gross profit margin increased by 0.7pcts to 43.5% year-on-year. Bioscience service revenue accounted for 46.6%, and overseas customer revenue accounted for 89%. Throughout the year, the company participated in 565 drug discovery projects and submitted 77 ind / NDAs. With strong demand and laboratory expansion, we expect the growth rate of the sector to be about 30% in 2022.
CMC (small molecule cdmo) revenue increased by 42.9% to 1.75 billion. The revenue of overseas customers accounted for 86%, and the gross profit margin increased by 2.2pcts to 34.9% year-on-year. By the end of 2021, there were 1013 projects in the pipeline, including 30 phase III projects, 5 projects in the commercialization stage, and 20% of the revenue was contributed by phase III and commercialization stage projects. We believe that the increase of capacity and business income in the later stage of clinical will drive the growth rate of sector revenue of 35-40% in 2022.
Clinical research revenue increased by 52% to 960 million. The revenue of overseas customers accounted for 48%, and the gross profit margin decreased by 8.5pcts to 10.3% year-on-year, or due to the adjustment of clinical strategies by some customers after the new deal of CDE, the company has integrated clinical R & D capabilities and optimized organizational structure since mid-2021. Benefiting from the accelerated clinical layout of Chinese pharmaceutical enterprises in China and the United States, we expect the revenue of the sector to increase by 35% and the gross profit margin to rise to about 15% in 2022.
The revenue of macromolecules, cells and gene therapy increased by 467% to 150 million, of which 98% came from overseas customers. ABL acquired by 2q21 has begun to undertake external orders, and the management expects it to turn loss into profit as early as 1q23.
Maintain the “buy” rating: we fine tuned the adjusted net profit forecast of 202223e to 1.97 billion / 2.65 billion (+ 1.3% / + 0.7%), corresponding to 202123ecagr of 34.7%. The current valuation of A-Shares / H shares of the company is only 47x / 31x2022epe, about 2 standard deviations lower than the historical average. We reiterate the “buy” rating; Taking into account the short-term impact of the newly acquired business on the profit margin and the reduction of the overall valuation center of the industry, the target 2022epe of A-Shares / H shares was reduced to 73x / 57x, which was equivalent to the average level of the past two years, corresponding to the target price of RMB178 4/HKD172. 1。
Investment risk: the growth of project orders is slower than expected; Fluctuation of investment income; The epidemic situation has been greatly repeated.
