\u3000\u30003 Zhejiang Kingland Pipeline And Technologies Co.Ltd(002443) 00244)
Conclusions and suggestions:
Company performance: in 22q1, the company achieved a revenue of 4.65 billion yuan, yoy + 62.1%, recorded a net profit attributable to the parent of 750 million yuan, yoy + 122.6%, and a net profit attributable to the parent of 125.6% after deduction. The company's performance is in the middle of the performance forecast range, in line with expectations. The substantial increase in performance is mainly due to the covid-19 epidemic in many places in the first quarter, which promoted the improvement of covid-19 testing services of the company.
Covid-19 nucleic acid detection has made a significant contribution. The original main business still maintained rapid growth, and the volume of independent products increased rapidly: (1) Q1 company's diagnostic service revenue was 2.85 billion yuan, yoy + 103.1%, mainly driven by covid-19 nucleic acid detection service revenue. Specifically, covid-19 business in Q1 single quarter contributed about 1.88 billion yuan of revenue, accounting for 40% of Q1's total revenue, and has also reached 72% of covid-19 business revenue in 2021, Considering the current epidemic situation in many places and the high demand for nucleic acid detection, it is expected that the covid-19 business in Q2 will still produce a large amount, while the revenue of routine detection service Q1 excluding covid-19 nucleic acid is 970 million yuan, yoy + 20.6%, which is relatively stable; (2) Q1's channel products achieved a revenue of 1.83 billion yuan, yoy + 21.1%, with a steady growth. (3) Benefiting from the listing of a variety of class II kits certified by the company, the company's self-produced product business realized an income of 370 million yuan, with a year-on-year increase of 202.6%, which continues to increase in volume, and is expected to become a stable driving force in the future.
The gross profit margin increased and all expense rates decreased: the company's comprehensive gross profit margin in 2021 was 43.9%, with a year-on-year increase of 5.9 percentage points, which is estimated to be mainly due to the change of business structure. During the period, the expense rate was 18.6%, with a year-on-year decrease of 0.9 percentage points, of which the sales expense rate decreased by 0.7 percentage points to 8.4%, the management expense rate decreased by 0.6 percentage points to 6.5%, the R & D expense rate decreased by 0.2 percentage points to 2.5%, and the financial expense rate decreased by 0.2 percentage points to 1.3%. All expense rates decreased. We believe that it is mainly due to the expansion of Q1 revenue scale.
Profit forecast and investment suggestion: under the background of covid-19 epidemic in many places, covid-19 nucleic acid detection remains high, and the short-term covid-19 detection business will still contribute more performance increment. In the medium and long term, the scale effect of the company's diagnostic services will continue to be reflected, the proportion of high-end testing will continue to increase, independent products will also become a driving force, and the main business profit will continue to grow. We expect the net profit of the company in 2022 / 2023 to be 1.69 billion yuan / 1.44 billion yuan, yoy + 45.6% / - 14.7%, EPS to be 2.7 yuan and 2.3 yuan, PE to be 10 times and 12 times respectively. Considering the strong demand for covid-19 nucleic acid detection under the short-term epidemic, we maintain the "buy" rating.
Risk warning: covid-19 nucleic acid testing service business shrinks, laboratory profits are lower than expected, the market competition of diagnostic products is fierce, the price drops, and the goodwill is impaired
