\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 566 Hubei Jumpcan Pharmaceutical Co.Ltd(600566) )
Key investment points
Performance: record high revenue and excellent operation quality for two consecutive quarters
In 2021, the company's operating revenue, net profit attributable to the parent and net profit deducted from non attributable to the parent were 7.631 billion yuan, 1.79 billion yuan and 1.557 billion yuan respectively, with a year-on-year increase of 23.77%, 34.60% and 26.15% respectively; The cash flow from operating activities was RMB 1.894 billion, with a year-on-year increase of 6.29%. Q4 single quarter analysis showed that the company's operating revenue, net profit attributable to the parent and net profit deducted from non attributable to the parent were RMB 2221 million, 447 million and 361 million respectively, with a year-on-year increase of 20.01%, 40.78% and 15.89% respectively.
In 2022q1, the company's operating revenue, net profit attributable to the parent company and net profit deducted from non attributable to the parent company were 2.174 billion yuan, 581 million yuan and 503 million yuan, with a year-on-year increase of 13.43%, 32.36% and 22.90% respectively; The cash flow generated from operating activities was 1.006 billion yuan, with a year-on-year increase of 38.11%, far higher than the net profit level, and the operation quality was excellent.
Growth analysis: the focus of sales shifted to pediatric drugs, and the volume of second-line categories accelerated
By product line, we believe that pediatric drugs and second-line categories will continue to maintain a high growth rate in 2022.
(1) pediatric products: in 2021, the revenue was 1.701 billion yuan (accounting for 22.29%, with a year-on-year increase of 63.85%). We estimate that it is mainly due to the year-on-year high-speed growth in the sales revenue of pediatric douqiao Qingre granules; In January 2022, the company launched a new version to improve the taste of drugs and children's compliance. We expect the company's pediatric drug revenue to account for more than 25% in 2022.
(2) second tier category: in 2021, the revenue of second tier varieties such as Jianweixiaoshi oral liquid, Huanglong Zhike granule and iron protein succinate oral solution maintained a high growth rate compared with the same period. Among them, Jianweixiaoshi oral liquid boosted the revenue of digestive drugs (a year-on-year increase of 23.65%) and Huanglong Zhike granule boosted the revenue of respiratory drugs (a year-on-year increase of 72.01%); By the end of 2021, the company has a promotion team of more than 3000 people. Relying on mature OTC channels, we expect the year-on-year growth rate of the company's main second-line varieties in 2022 to reach 40% - 50%.
(3) antipyretic and detoxifying drugs: antipyretic and detoxifying drugs are mainly Pudilan anti-inflammatory oral liquid, with an income of 7.334 billion yuan (accounting for 31.74%, with a year-on-year increase of 13.16%), and the impact of medical insurance withdrawal basically bottomed out; With the increase in the proportion of OTC channel revenue, we believe that the year-on-year growth rate of Pudilan sales revenue will remain stable.
Profitability analysis: optimize channel management and achieve record profits
The company's gross profit margin and net profit margin increased by 61pct and 60pct respectively in 2021. In a single quarter, the net profit margin of the company in 2022q1 increased by 6.61pct to 26.74% month on month, a record high, due to the adjustment of the company's product structure to improve the gross profit margin, while deepening marketing management and optimizing the channel structure to effectively control the expense rate. With the further expansion of OTC channels, we expect that there is still room for continuous improvement in the profitability from 2022 to 2024.
Operating quality analysis: operating cash flow far exceeds net profit
In 2021, the company's cash flow from operating activities was 1.894 billion yuan, a year-on-year increase of 6.32%; Among them, the contract liabilities at the end of 2021 increased by 140.87% compared with the beginning of the period, ensuring the company's future performance. In a single quarter, the operating cash flow of 2022q1 company was 1.006 billion yuan, a year-on-year increase of 38.11%, far exceeding the net profit level; In terms of inventory level, the company's 2022q1 inventory increased by 31.14 million yuan to 407 million yuan compared with the beginning of the period, reflecting the company's increase in stock to cope with the subsequent increase in demand for major drugs. We expect that driven by sales, the company's operating cash flow will maintain a high-speed growth trend from 2022 to 2024.
Strategic layout: epitaxial M & A, growth hormone is expected to start in large quantities in 2024
The company cooperates with Tianjing biology to develop and produce long-acting growth hormone tj101. Compared with short-acting growth hormone, the competition pattern of long-acting growth hormone is better and the market potential is huge. At present, tj101 is in the late stage of clinic. We expect it will gradually increase its volume in 2024, and it is expected to quickly expand the market and open the growth ceiling of the company with the help of the company's mature pediatric sales channels.
Profit forecast and valuation
We estimate that the operating revenue of the company from 2022 to 2024 will be RMB 86.06/94.51/10.390 billion respectively, with a year-on-year growth rate of 12.79% / 9.81% / 9.93%; The net profit attributable to the parent company was RMB 2.071/2.308/2.546 billion respectively, with a year-on-year growth rate of 20.48% / 11.44% / 10.29%, corresponding to the current PE of 9.79x/8.78x/7.96x respectively, which has the valuation cost performance and maintains the "overweight" rating.
Risk tips
New varieties OTC channel management risk; Uncertainty risk of growth hormone R & D progress; Affected by centralized purchase, the price of the company's core drugs is at risk of sharp fluctuation.
