\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 535 Tasly Pharmaceutical Group Co.Ltd(600535) )
Event: the company released its 2021 annual report, realizing operating revenue of 7.952 billion yuan (- 41.43%), net profit attributable to shareholders of listed companies of 2.359 billion yuan (+ 109.51%), deducting net profit attributable to shareholders of non listed companies of 609 million yuan (- 26.84%).
The provision for impairment loss of T101 project, temozolomide centralized purchase and investment in biological drug R & D increased, which affected the apparent performance, and the traditional Chinese medicine sector resumed growth. In 2021, the company’s deduction of non profit decreased year-on-year, mainly due to: (1) according to the progress of T101 project, the company suspended clinical trials and accrued asset impairment, which affected the net profit attributable to the parent company by about 246 million yuan; (2) The price of temozolomide, the core variety of chemical drugs, was reduced by 53% in centralized mining. The decrease in revenue was mainly due to the disposal of Tianshi marketing equity, a pharmaceutical commercial subsidiary, in August 2020. In terms of products, the traditional Chinese medicine sector achieved an operating revenue of 5.080 billion yuan (+ 13.73%), of which Dandi, Yangxue Qingnao series and other core varieties resumed growth, Qishen Yiqi dropping pills increased rapidly, and Yiqi Fumai and Salvia miltiorrhiza polyphenolic acid are also expected to maintain a rapid growth rate. Affected by the centralized purchase of temozolomide, the revenue of the chemical sector was 1.255 billion yuan (- 23.78%), and the net profit of Jiangsu Diyi was 255 million yuan (- 44.73%). The revenue of biological medicine sector was 252 million yuan (+ 17%), and Tasly Pharmaceutical Group Co.Ltd(600535) biological loss was 434 million yuan, with a year-on-year increase of 109 million yuan. It is expected that it is mainly due to the increased investment in biological medicine R & D.
Investment in research and development has increased, and innovative drugs are progressing smoothly. In 2021, the company invested 761 million yuan (+ 26.83%) in R & D, giving full play to the collaborative development advantages of modern traditional Chinese medicine, biological medicine and chemical medicine. Among them, 30 products were distributed in modern traditional Chinese medicine. In 2021, kunxinning granule, a class 1.1 innovative traditional Chinese medicine, was approved, and Dandi added sugar net indications. There are 23 types of biopharmaceutical products, of which puyouke has increased the indications of acute ischemic stroke and acute pulmonary embolism. The application for registration of biopharmaceutical products has been submitted and accepted. Chemical drugs have 38 products, innovative drugs have made phased progress, and a number of generic drugs have submitted listing applications.
The operation quality has been greatly improved and the performance has been solid and steady. The net cash flow from the company’s operating activities in 2021 was 2.801 billion yuan (+ 56.39%). The accounts receivable of pharmaceutical industry decreased from 1.749 billion yuan at the beginning of the year to 1.13 billion yuan, a decrease of 35.39%. The accounts receivable (mainly traditional Chinese medicine business) in the statement of the parent company has continued to decline since 2019, indicating that the channel de inventory work has made significant progress. We believe that the current channel inventory has been in a benign state, and the core varieties of traditional Chinese medicine will resume a steady growth trend in the future. After the divestiture of pharmaceutical commercial business, the turnover rate of accounts receivable of the company also increased significantly.
Profit forecast and Valuation: we believe that with the digestion of the impact of temozolomide centralized mining, the core varieties of traditional Chinese medicine will return to growth and the large volume of second-line varieties, 2022 will be the inflection point of the company’s profit (after deduction). It is estimated that the company’s revenue from 2022 to 2024 will be 8.610 billion yuan, 9.358 billion yuan and 10.219 billion yuan respectively, with a year-on-year increase of 8.3%, 8.7% and 9.20%; The net profit attributable to the parent company was 1.135 billion yuan, 1.339 billion yuan and 1.567 billion yuan respectively, with a year-on-year growth rate of – 51.9%, 18.1% and 17.0%. Based on the closing price on March 30, the corresponding PE was 20, 17 and 14 times respectively, and the “buy” rating was given for the first time.
Risk warning: the price reduction of centralized purchase of Chinese patent medicine is higher than expected; The fluctuation of fair value of financial assets leads to the deviation of profit forecast.
