\u3000\u3 Guocheng Mining Co.Ltd(000688) 076 Jiangsu Sinopep-Allsino Biopharmaceutical Co.Ltd(688076) )
Key investment points
Event: the company released the annual report of 2021 and the first quarterly report of 2022. In 2021, the operating revenue will reach 640 million yuan (+ 13.6%); The net profit attributable to the parent company is 120 million yuan (- 6.5%); The net profit attributable to the parent company after deducting non profits is 100 million yuan (+ 11%). In the first quarter of 2022, the operating revenue was 130 million yuan (- 19.2%); The net profit attributable to the parent company is RMB 20 million (- 59.5%); The net profit attributable to the parent company after deducting non-profit is RMB 100 million (- 66.6%).
Affected by the epidemic, the performance is under pressure in the short term. In 2021, the company’s revenue growth slowed down, with a year-on-year increase of 13.6%. In the first quarter of 2022, the revenue continued to decline, with a year-on-year decrease of 19.2%. By product, the revenue from customized products and services in 2021 was 510 million yuan (+ 23.82%); The income from independently selected products is 130 million yuan (- 14.11%); By region, the overseas revenue in 2021 was 360 million yuan (- 10.6%); China’s revenue was 280 million yuan (+ 74.4%). The main reasons are as follows: 1) overseas orders are greatly affected by the epidemic, and it is inconvenient for the company to visit and expand overseas customers, which has a certain impact on the development of new orders. 2) The income of some independently selected products has declined to a certain extent due to the impact of changes in the market environment and the research and development progress of downstream products. In 2022, the company will strengthen the development of new customers and Chinese market to ensure the continuity and stability of the company’s business.
The production capacity continues to expand to cope with the incremental market demand in the future. At present, the company has Jiande and Jiangsu Lianyungang Port Co.Ltd(601008) two modern production bases. The existing capacity of Jiande factory is 1075000 liters, which can provide customized production services from laboratory level to ton level Jiangsu Lianyungang Port Co.Ltd(601008) factory now has 2 polypeptide API production workshops, 5 small molecule chemical API production workshops and 2 preparation production workshops. In 2021, Jiande factory started the construction of phase II GMP production workshop. It is estimated that the new capacity will be about 400000 liters, which will be gradually put into use in 2022 and 2023 Jiangsu Lianyungang Port Co.Ltd(601008) factory, the company started and completed the apc180 project to expand the production capacity to 2.5 times of the original production capacity, providing an effective guarantee for the company to undertake new orders and customer delivery.
Continue to increase research and development efforts and take the lead in polypeptide drug technology. The R & D investment was RMB 1.68 billion, accounting for 1.01% of the total revenue in 2027. In terms of customized products and services, we have completed the process research and development of 25 new projects, of which 17 projects have realized factory scale-up production for the first time. At present, the single batch output of long-chain modified peptide drugs such as liraglutide and ibovetai exceeds 5kg, reaching the industry-leading level. By the end of 2021, 11 polypeptide APIs of the company had obtained the US DMF / VMF number and passed the integrity audit. Relying on its technological advantages, the company has established long-term and stable cooperative relations with global well-known innovative pharmaceutical enterprises such as Gilead and INSEAD.
Profit forecast and rating. We expect that the EPS from 2022 to 2024 will be 0.67 yuan, 0.86 yuan and 1.09 yuan respectively, corresponding to the current stock price valuation of 36 times, 28 times and 22 times respectively, maintaining the “buy” rating.
Risk warning: order fluctuation risk; R & D is not as expected; Exchange rate fluctuation risk.
