\u3000\u3 China Vanke Co.Ltd(000002) 603 Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) )
Event: the company released the annual report of 2021 and the first quarterly report of 2022. In 2021, the company’s revenue was 10.117 billion yuan, a year-on-year increase of + 15.19%, and the net profit attributable to the parent was 1.344 billion yuan, a year-on-year increase of + 10.27%, deducting 1.265 billion yuan of non attributable net profit, a year-on-year increase of + 8.60%. The dividend plan is to distribute a cash dividend of RMB 3.00 (including tax) for every 10 shares
In 2021q4, the company’s revenue was 2.005 billion yuan, a year-on-year increase of – 14.13%, the net profit attributable to the parent was 120 million yuan, a year-on-year increase of – 40.68%, and the net profit not attributable to the parent was 91 million yuan, a year-on-year decrease of – 50.30%.
In 2022q1, the company’s revenue was 2.722 billion yuan, a year-on-year increase of – 25.80%, the net profit attributable to the parent was 484 million yuan, a year-on-year increase of – 28.22%, and the net profit not attributable to the parent was 490 million yuan, a year-on-year decrease of – 26.67%.
The overall performance is in line with expectations, and the high base affects the apparent growth rate. The performance of the company in 21 years and 22q1 is in line with our previous expectations. The profit side of 21q4 declined significantly. On the one hand, it was due to the decline of high base income in the previous year, on the other hand, it was due to the decline of gross profit margin and the significant increase of R & D and management expenses; The decline in revenue and profit of 22q1 was close to that of the previous year, which was mainly due to the high base of the previous year (presumably Lianhua Qingwen).
Lianhua Qingwen has performed steadily for 21 years and is expected to be low before and high after 22 years. The company’s cold medicine is Lianhua Qingwen until 2021. Lianhua Qingke tablet has contributed revenue for 21 years, and the contribution is expected to be small. At the level of tens of millions, the revenue of cold medicine can basically be regarded as the revenue of Lianhua Qingwen. According to micnet data, in 2021h1, Lianhua Qingwen has a 43.5% market share in the cold market of Chinese patent medicine in public health care, and the important market share of cold at retail terminals is 6.63%, second only to cold particles (7.56%). In 2021, the company’s revenue from cold drugs was 4.108 billion yuan, a year-on-year increase of – 3.5%; Among them, the revenue in the first half of the year was 2.49 billion yuan, a year-on-year increase of + 23%. Judging from the seasonal characteristics of cold drugs, most of them should be confirmed in 21q1, resulting in a high base. In 2022q1, although there were serious sporadic epidemics in many places in China, it also affected the drug purchase of influenza drugs, and the aggravation of the epidemic in many cities occurred in the middle and late March, which may not contribute to the delivery and sales in the first quarter. We judge that the company’s cold drugs are expected to usher in an outbreak in 22q2 and significantly exceed the sales scale of the previous year in the whole year.
Cardiovascular and cerebrovascular drugs have achieved accelerated growth in 21 years. In 2021, the company’s revenue from cardiovascular and cerebrovascular drugs reached 4.534 billion yuan, a year-on-year increase of + 32%. Compared with the growth of about 10% in the past few years, the growth rate has increased significantly. We judge that the company’s cardiovascular and cerebrovascular products have accelerated growth. First, after the company won the first prize of national scientific and technological progress in 2020, the recognition of the company’s products by hospitals and doctors has been further improved. On the other hand, the company’s marketing reform, sales personnel expansion and channel sinking have also achieved results. According to micnet data, Tongxinluo capsule, Shensong Yangxin capsule and Qiliqiangxin capsule ranked second, fifth and ninth respectively in the ranking of oral administration of Chinese patent medicine for cardiovascular diseases in the public medical market in the first half of 2021, with a market share of 8.81%, 6.66% and 1.98%. At the end of retail pharmacies, the total market share of the three varieties of “tongshenqi” was 6.09% in 2021. It is expected that the company’s cardiovascular and cerebrovascular products will still achieve double-digit growth after the second spring.
Other patented traditional Chinese medicine performed brilliantly. In 2021, the company’s revenue from other patented traditional Chinese medicine was 471 million yuan, a year-on-year increase of + 56%. According to the company’s announcement, second-line varieties such as Jinlida granules and xialiqi capsules increased by more than 90% year-on-year, realizing large-scale growth. We judge that the second-line varieties created by Jinlida granule, xialiqi capsule and Bazi Bushen have reached the level of more than 100 million.
Other main formula particles are growing rapidly. In 2021, the company’s other main business income was 998 million yuan, a year-on-year increase of + 29.77%. On the one hand, it was a low base in 2020. On the other hand, the company’s formula particle business sales income increased by nearly 300% year-on-year. We judge that its volume has reached 100 million. The company has developed 182 of the 196 national standard products published in the review, and Hebei standard formula particles are also in the rapid R & D review filing. Formula particles may become a new growth point of the company.
Profit forecast: it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 1.67 billion yuan, 2.02 billion yuan and 2.46 billion yuan respectively, with corresponding growth rates of 24.1%, 21.1% and 21.7% respectively; EPS is 1.00 yuan, 1.21 yuan and 1.47 yuan respectively, and the corresponding PE is 25X, 21x and 17x respectively. Maintain the “buy” rating.
Risk tips: the risk of slowdown in the growth of large varieties, the risk of product price reduction, the risk that the R & D progress is less than expected, and the risk of price fluctuation of raw materials.
