\u3000\u3 Guocheng Mining Co.Ltd(000688) 166 Brightgene Bio-Medical Technology Co.Ltd(688166) )
Core view
It began with high-end characteristic API and entered the accelerated growth period. At the beginning of its establishment, the company was committed to the R & D and synthesis of characteristic APIs, and selected varieties with high difficulty and good competition pattern, such as micafungin and caspofungin. In recent years, the downstream orders were abundant, driving the accelerated growth of revenue and profit. With the change of industrial policies, the company has carried out the integrated transformation of preparations. At present, it has successfully developed six kinds of preparations, with rich reserve pipelines under research. In addition to the varieties of preparations, the company is developing innovative drugs such as antitumor drugs through independent research and development and investment. On the whole, with rapid growth in performance and abundant pipeline reserves, the company has entered a stage of rapid development.
Characteristic APIs highlight the technical barriers to synthesis and have rich variety reserves. Focusing on the synthesis of APIs, the company has maintained high investment in research and development, and has established multiple technical platforms such as semi fermentation synthesis and chiral synthesis center, laying a foundation for the synthesis of highly difficult APIs. From the perspective of many of China's first generic APIs synthesized by the company, we believe that the company has the technical barriers to realize synthesis and production quickly and efficiently. The company's ability to negotiate the price of the company's equity is also fully reflected in the company's high gross profit margin. In the long run, the company has the ability to continuously obtain high value-added products with good competition pattern.
There are many opportunities for the integration of preparations and the "combination of imitation and innovation". Under the centralized procurement policy, the pharmaceutical pattern has changed and the preparation integration of API enterprises has become a general trend. Relying on the core competitiveness of synthetic technology, the company seizes the Transformation Opportunity and continues to develop preparations with high difficulty and broad downstream market. The company has successfully listed six preparation pipelines, including the first imitation heavy pipeline such as oseltamivir phosphate. There are abundant pipelines under development at the preparation end. Irebrin anticancer drug is expected to become the first imitation in China, and preparations related to iron and respiratory preparations are also being arranged. In terms of innovative drugs, the company is also laying out polymer coupling innovative drugs, ADC innovative drugs, COPD inhibitors, etc., and its long-term development is worth looking forward to.
Profit forecast and investment suggestions
We predict that the company's earnings per share from 2021 to 2023 will be 0.59/0.81/1.13 yuan respectively. According to the comparable company PE with characteristic API as the main business, we predict that the reasonable valuation level of the company in 22 years will be 43 times PE, and the corresponding target price will be 34.83 yuan. We will give a "buy" rating for the first time.
Risk tips
The R & D of new varieties is less than expected, the sales of preparation varieties is less than expected, the ramp up of production capacity is less than expected, and the preparation varieties are included in the centralized purchase
