\u3000\u3000 Hangzhou Tigermed Consulting Co.Ltd(300347) (300347)
Key investment points
Event: on January 12, 2022, the company released the performance forecast for 2021. In 2021, the company is expected to realize the net profit attributable to the parent company of RMB 2.625-3.027 billion, a year-on-year increase of 50% – 73%; The non net profit deducted was RMB 1.133-1.324 billion, with a year-on-year increase of 60% – 87%.
The performance slightly exceeded expectations, and the net profit attributable to the parent company and deducted from non-profit in a single quarter hit a record high, with a significant trend of continuous high growth. In 2021, the company expects to realize the median net profit attributable to the parent company of about RMB 2.826 billion (+ 61.5%), and the median net profit deducting non net profit of about RMB 1.229 billion (+ 73.5%), both of which continue to maintain rapid growth. Benefiting from the rapid growth of the industry and the strong competitive advantage of the company, we expect the company’s core business statistics, Fonda and clinic to maintain rapid growth. Quarterly, the median return to parent in 2021q4 is about 1.045 billion yuan (+ 142.0%), and the non net profit deducted in 2021q4 is 360 million yuan (+ 70.86%), which still maintains the accelerated growth trend under the high base trend in the second half of last year. We expect it to be mainly due to the accelerated recovery of the main business. In addition, the reason why the parent company’s growth rate is higher than that of non deduction is mainly due to the higher income from changes in the fair value of financial assets recognized by the company in accordance with the new standards for financial instruments. It is estimated that the non recurring profit and loss in 2021 will be about 1.4-1.8 billion yuan and the income from changes in fair value will be about 1.2-1.6 billion yuan. Therefore, we believe that the company has been deeply engaged in the industry for many years, and the investment of each innovative pharmaceutical enterprise is carried out after fully evaluating the innovative pharmaceutical industry and its own ability. In the future, this part of the income is expected to become a long-term stable source of income and has the potential for sustainable growth.
In the long run: ① with the accelerated growth of clinical cro Prosperity: Chinese clinical cros are relatively scattered. As the high prosperity of Chinese preclinical cros continues to transmit to downstream clinical cros, the company, as the leader of Chinese clinical cros, will fully enjoy the trend of rapid development and concentration improvement of the industry. ② The global layout is expected to bring new increment: the company’s clinical cro business is expected to expand globally and gradually become a new growth point by accompanying the internationalization of Chinese innovative drugs to the sea and gradually completing the layout in the Asia Pacific region.
Profit forecast and Valuation: according to the company’s performance forecast, we adjust the company’s profit forecast. We expect the company’s operating revenue to be RMB 4.338 billion, 5.636 billion and 7.240 billion from 2021 to 2023, with a year-on-year increase of 35.89%, 29.93% and 28.45%; The net profit attributable to the parent company was RMB 2.813 billion, RMB 3.335 billion and RMB 3.838 billion respectively (RMB 2.097 billion, RMB 2.475 billion and RMB 2.905 billion before adjustment), with a year-on-year increase of 60.76%, 18.55% and 15.10% (19.85%, 18.03% and 17.36% before adjustment). The company is the leader of clinical cro in China, with prominent competitive advantage and maintaining the “buy” rating.
Risk warning events: the public materials used in the research report may have the risk of information lag or untimely update; Risk of loss of core technical personnel; Risk of industry R & D investment falling short of expectations; Risk that overseas business integration does not meet expectations; Risk of intensified industry competition; Exchange rate fluctuation risk.
