\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 607 Shanghai Pharmaceuticals Holding Co.Ltd(601607) )
The industry has increased investment in R & D and highlighted the attribute of innovation. In 2021, the pharmaceutical industry achieved a revenue of 25.098 billion yuan, a year-on-year increase of 5.71% and a gross profit margin of 58.7%. Among them, the sales revenue of 60 key varieties was 14.724 billion yuan, a year-on-year increase of 9.31% and an average gross profit margin of 71.38%. In 2021, the total R & D investment reached 2.503 billion yuan, a year-on-year increase of 26.94%. The company adheres to independent research and development and BD two wheel drive. Three class 1 new drugs, ankerui (recombinant human adenovirus type 5), kailikang (urecolin) and Peifeikang (Bifidobacterium triple viable bacteria), have been listed. 39 new drugs and 8 improved new drugs are being developed, of which 6 innovative drug management lines are in the stage of key research or clinical phase III. At present, there are 16 rare disease projects under research on the platform of yaoruier above the company.
Accelerate the development of large varieties of traditional Chinese medicine and introduce Yunnan Baiyao Group Co.Ltd(000538) war investment Shanghai Pharmaceuticals Holding Co.Ltd(601607) has 7 subsidiaries of core traditional Chinese medicine, 9 widely recognized core brands, 3 National Confidential formulas and 860 kinds of traditional Chinese medicine products. The key varieties include Shexiang Baoxin Pill, Shenmai injection, Gualou PI injection, Xinhuang tablet, Ginkgo biloba ketone ester, Weifuchun tablet, Yangxin tablet, babaodan, Yuxuebi and Rupixiao. After the introduction of Yunnan Baiyao Group Co.Ltd(000538) war investment in 2021, the Yunnan Baiyao Group Co.Ltd(000538) brand experience will be deeply combined with the company’s rich pipeline and strong R & D capability to cooperate in the secondary development of new and old varieties. The goal is to manufacture more than 6 large varieties of more than 800 million yuan, which is expected to bring 2-3 billion yuan of incremental revenue. As of March 31, 2022, the first incentive plan of the company has been completed, and the exercise shares account for 4.65% of the total, so as to further promote the reform of system and mechanism and stimulate vitality.
Business leaders still have room for improvement, and covid-19 blessing provides performance flexibility. In 2021, Shanghai Pharmaceuticals Holding Co.Ltd(601607) commercial business contributed 190.62 billion yuan in revenue. The top 10 pharmaceutical wholesale enterprises account for 55.2% of their income, and Shanghai Pharmaceuticals Holding Co.Ltd(601607) accounts for 8.45%, ranking second in China, with room for improvement. In 2021, the company’s imported vaccine agent achieved a sales revenue of 4.3 billion yuan. Taking the covid-19 vaccine cooperation as a breakthrough, the company further extends the industrial chain from import and distribution to production and R & D. with the help of the existing technology platform and distribution advantages, the company cooperates strategically with Cansino Biologics Inc(688185) to enter the field of innovative vaccine production. The company is expected to reach covid-19 drug cooperation and bring large performance increment.
Profit forecast and investment rating: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 5.980/6.983/8.194 billion yuan respectively, with a growth rate of 17% / 17% / 17%, maintaining a double-digit growth rate. The current market value corresponds to 12 / 10 / 9 times of PE from 2022 to 2024. Based on 1) stable development of distribution and industrial business; 2) The traditional Chinese medicine sector cooperates with Yunnan Baiyao Group Co.Ltd(000538) to develop large varieties and accelerate large-scale production; 3) I001, x842 and other innovative drugs are on the market, bringing increment; 4) the Internet plus platform construction of commercial retail. For the first time, give a “buy” rating.
Risk warning: centralized purchase risk, R & D progress less than expected, goodwill impairment risk, strategic transformation less than expected risk, covid-19 business uncertainty
