Heyuan Biology (688238)
Event: the company released the first quarterly report of 22 years. In Q1, the revenue was 73 million yuan (+ 56.85%), the net profit attributable to the parent company was 12 million yuan (+ 28.78%), and the net profit attributable to the parent company after deduction was 11 million yuan (+ 26.18%). The overall performance is in line with expectations.
With sufficient business orders, CGT cdmo revenue maintained rapid growth. In terms of splitting, in the first quarter, the revenue from cro business was 11 million yuan (+ 13.93%), and the revenue from cdmo business was 61 million yuan (+ 69.28%). The company had abundant orders, and ind-cmc developed rapidly. Among them, the oncolytic virus projects serving Yinuowei and funuojian have entered phase II clinical practice, which will contribute to abundant commercial order revenue in the future.
The gross profit margin increased steadily, and share based payment and R & D expenses affected the net profit margin. Thanks to the embodiment of the scale effect of the company's cdmo business, the company's overall gross profit margin in the first quarter increased by 5.24pct to 51.08% year-on-year. On the expense side, the total expense rate during 22q1 was 32.81% (+ 6.97 PCT), of which the management and R & D expense rates increased by 4.89 and 3.77 PCT respectively year-on-year, mainly because 1) the option incentive plan was implemented in April 2021, and the share payment of RMB 4.6879 million was confirmed in 22q1; 2) Increased investment in R & D. 22q1 company's net interest rate was 16.51%, down 3.60pct year-on-year.
Maintain the "buy" rating. The company is a pioneer in the cdmo industry of cell gene therapy in China. In recent ten years, it has developed and built a high-quality gene therapy carrier development, production process and quality control platform. Its business coverage is comprehensive. In recent years, the number of projects has expanded rapidly and there are abundant orders on hand. It is expected to achieve rapid development by taking the east wind of industry development. It is estimated that the net profit attributable to the parent company in 22-24 years will be RMB 85 / 114 / 241 million, corresponding to 97 / 72 / 34 times of the current PE, maintaining the "buy" rating.
Risk warning. Customer expansion is less than expected, the order volume is less than expected, the development of new products is less than expected, and the price drop is more than expected.
