\u3000\u30 Zhongyan Technology Co.Ltd(003001) 71 Tofflon Science And Technology Group Co.Ltd(300171) )
Key investment points:
Event: the company released] the performance report for 2021 and achieved an annual operating revenue of 4.19 billion yuan, a year-on-year increase of 54.8%; The net profit attributable to the parent company was 830 million yuan, a year-on-year increase of 78.6%. In 2021q4, the revenue was 1.31 billion yuan, a year-on-year increase of 55.3%, and the net profit attributable to the parent company was 270 million yuan, a year-on-year increase of 53.8%.
The company’s biopharmaceutical related business grew faster. In 2021, the company’s revenue from injection single machine and system segment was 1.38 billion yuan, a year-on-year increase of 13.1%; The revenue of bioengineering stand-alone machines and systems was 910 million yuan, an increase of more than 300% year-on-year. We estimate that the revenue of bioengineering sector increased month on month in the fourth quarter, mainly due to strong market demand, the company’s products were recognized by downstream customers, and the sales volume accelerated. It is expected to maintain high-speed growth in the future; The revenue of medical equipment and consumables was 500 million yuan, with a year-on-year increase of 104.8%. We estimate that the company’s disposable bags were in high volume in the fourth quarter, and the revenue in a single quarter exceeded the sum of the first three quarters. In terms of sub regions, the company achieved revenue of 3.15 billion yuan in China and 1.04 billion yuan overseas, accounting for about 25% of overseas business revenue.
The profitability of the company was significantly improved in 2021. In 2021, the company’s sales expenses, management expenses and R & D expenses were 190 million yuan, 370 million yuan and 280 million yuan respectively, accounting for 4.6%, 15.7% and 6.8% of revenue respectively, with a year-on-year increase of – 0.9pp, – 0.3pp and 1pp respectively. The decrease of sales expense rate and management expense rate is mainly due to the rapid growth of revenue in 2021, including some covid-19 related orders; The increase in R & D expense rate is mainly due to the rapid increase in R & D investment due to the company’s layout of biological drugs, CGT related products and consumables. The gross profit margin of sales in 2021 was 46.1%, 0.5pp higher than that in the third quarterly report, and 4.3pp higher than that in 2020; The net profit margin of sales was 21.1%, with a year-on-year increase of 3.3pp and a month on month increase of 0.5pp compared with the third quarterly report. The profit margin of the company ranks at a high level in the industry and increased more year-on-year in 2020, mainly due to the increase in the proportion of biological drug related equipment with high gross profit and overseas revenue.
The company plans to increase financing to expand business layout. In March 2022, the company announced the fixed increase plan, and the total amount to be raised shall not exceed 3.2 billion yuan. The fixed increase plans to issue no more than 190 million new shares to no more than 35 objects. The raised investment project is mainly used to expand the production capacity of preparation equipment and expand the layout of CGT equipment consumables. The company has a comprehensive layout of relevant equipment and consumables upstream and downstream of biopharmaceutical production, and can provide customers with stainless steel / disposable bioreactor, chromatography, ultrafiltration and other separation and purification systems. It is expected that in the future, the company will increase investment in relevant industrial layout and grasp the import substitution time window of domestic pharmaceutical equipment and consumables.
Profit forecast and investment suggestions: it is estimated that the company’s EPS from 2022 to 2024 will be 1.77 yuan, 2.32 yuan and 3.02 yuan respectively. The company will prospectively layout various equipment consumables in the field of biological medicine and continue to expand its product portfolio. The net profit attributable to the parent company will maintain a compound growth rate of 32% and maintain the “buy” rating in the next three years.
Risk tip: the downstream demand boom is less than expected, the company’s R & D progress is less than expected, and the competition pattern deteriorates.
