\u3000\u3000 Hualan Biological Engineering Inc(002007) (002007)
Events
On January 12, Hualan vaccine, a subsidiary of the company, obtained the listing approval of China Securities Regulatory Commission.
Business analysis
The performance of Hualan vaccine fluctuates in the short term, and the medium and long-term industrial trend remains unchanged. Hualan vaccine is the first enterprise approved to produce tetravalent influenza vaccine in China. In 2018-2020, the proportion of batch issuance of tetravalent influenza virus split vaccine of Hualan vaccine was 100.00%, 86.10% and 61.41% respectively, ranking first in the industry. Affected by the covid-19 epidemic in some parts of China in the fourth quarter of 2021, as well as the start of covid-19 vaccination and vaccination of children under the age of 12, the operating revenue of Hualan vaccine is expected to be RMB 1.941 billion to RMB 2.669 billion in 2021, a year-on-year increase of – 20% – 10%; The net profit attributable to the parent company is expected to be 740-1017 million yuan, a year-on-year increase of – 20% – 10%. The penetration rate of influenza vaccine in China is low, which is far lower than the average level of developed countries. The improvement of people’s health awareness of respiratory diseases under the epidemic situation will promote the continuous improvement of industry penetration rate.
Spin off and listing will help the company highlight its main business and enhance its comprehensive competitiveness. The company’s spin off of its subsidiary Hualan vaccine is conducive to highlighting its main business and enhancing its independence. After the spin off and listing, Hualan Biological Engineering Inc(002007) and other subordinate enterprises (except Hualan vaccine) will continue to focus on the development of businesses other than vaccine R & D, production and sales, while the vaccine product business is operated by Hualan vaccine, a holding subsidiary. After the spin off and listing, Hualan vaccine will insert the wings of scientific and technological innovation and capital to help the sustained and rapid development in the future.
The raised funds are mainly used for the development and industrialization of influenza vaccine and new pneumonia vaccine. Hualan vaccine plans to invest 1.084 billion yuan in the development and industrialization of influenza vaccine and the construction project of supply guarantee capacity of existing products, that is, to increase the production capacity of existing tetravalent influenza vaccine to 100 million doses / year. 761 million yuan will be used for the development and industrialization of new pneumonia vaccine, that is, to build a production line with an annual production capacity of 200 million doses of new pneumonia vaccine.
Profit adjustment and investment suggestions
Considering the impact of covid-19 epidemic in some parts of China, covid-19 vaccination and vaccination of children under 12 years of age in 2021q4, we lowered the company’s profit expectation for 21 years by 30%, and it is expected that the company’s net profit attributable to its parent in 21-23 years will be 1.381 billion yuan, 2.396 billion yuan and 2.921 billion yuan, with a year-on-year increase of – 14%, 73% and 22% respectively.
Maintain the “buy” rating.
Risk tips
Risk that R & D progress is less than expected; Risk of intensified market competition; The recovery of slurry mining does not meet the expected risk; The expansion of pulp station is less than expected; The progress of product technology transfer and production technology development does not meet expectations, etc.
