\u3000\u3000 Hangzhou Tigermed Consulting Co.Ltd(300347) (300347)
Event: the company released the performance forecast for 2021 and realized the net profit attributable to the parent company of RMB 2.625 billion - 3.027 billion in 2021, with a year-on-year increase of 50% - 73%; Net profit deducted from non parent company was 1.133 billion-1.324 billion, with a year-on-year increase of 60% - 87%, and the performance exceeded our previous expectations.
The main business grew strongly and the non recurring profit and loss reached a new high. Based on the median value, the net profit deducted from non parent company in 21q4 was 360 million yuan (+ 72.8% YoY), and the net profit deducted from non parent company in 21q1-q4 in a single quarter increased by 98.4% / 67.3% / 67.6% / 72.8% respectively year-on-year, reflecting the strong growth of the company's main business. The company's non recurring profit and loss increased significantly from 1.04 billion yuan in 2020 to 1.4-1.8 billion yuan (+ 34.6% - 73% YoY) in 2021, mainly due to the income from changes in the fair value of financial assets recognized by the company in accordance with the new standards for financial instruments and the income from equity transfer, of which the income from changes in the fair value of companies invested directly or indirectly was 1.2-1.6 billion yuan.
Innovative drugs are mainly clinical services, with a prominent leading position. In July 21, the drug evaluation center of the State Food and Drug Administration issued the guiding principles for clinical research and development of anti-tumor drugs oriented by clinical value (Exposure Draft), and the market had doubts about the prosperity of CXO. Hangzhou Tigermed Consulting Co.Ltd(300347) as a leading clinical cro enterprise, it mainly serves innovative drug projects and benefits from China's incentive policies for innovative drugs. This view is supported by the acceleration of 21q3-q4 deduction of non parent net profit.
Globalization is advancing steadily, the industrial chain is extended, and synergy is strengthened. The company strives to build a global clinical cro capability and is in a leading position among Chinese clinical cro companies. 21h1 company implemented 140 drug clinical research projects overseas, with a year-on-year increase of 37%, covering 29 global multicenter clinical trials. In addition, Fangda, the company's U.S. holding subsidiary, has arranged the production capacity in China, focused on building preclinical and CMC service capabilities, formed synergy with the parent company, and built the whole process service of preclinical integration, clinical trial and CMC development. The company's clinical business goes out, the preclinical business is brought back, and the two-way force is expected to further open the growth space.
Profit forecast, valuation and rating: the company is the leader of clinical cro in China. Considering that the profit exceeds expectations, the global business development trend is good, and the subsidiary Fangda is put into operation and expanded in China, we raised the company's EPS forecast for 21-23 years to 3.01/3.54/4.15 yuan (21.9% / 20.4% / 18.6% respectively compared with the previous forecast), with a year-on-year increase of 50.25% / 17.37% / 17.33% respectively, The corresponding PE of 21-23 years is 41 / 35 / 30 times, maintaining the "buy" rating.
Risk warning: the global investment in new drug R & D is less than expected; Investment income fluctuates.
