\u3000\u3000 Wuxi Apptec Co.Ltd(603259) (603259)
Event overview
The company released the performance forecast of 2021 annual report: it is expected to achieve an operating revenue of 22.82 ~ 22.9 billion yuan in 2021, with a year-on-year increase of 38.0% ~ 38.5%; The net profit attributable to the parent company was 4.973 ~ 5.032 billion yuan, with a year-on-year increase of 68.0% ~ 70.0%; The net profit deducted from non profits was 4.007 ~ 4.055 billion yuan, with a year-on-year increase of 68.0% ~ 70.0%.
Analysis and judgment:
The performance continues to grow at a high speed. Looking forward to the future, it will continue to grow at a high speed
In 2021, the company achieved an operating revenue of 22.82 ~ 22.9 billion yuan, with a year-on-year increase of 38.0% ~ 38.5%, of which Q4 achieved an operating revenue of 6.297 ~ 6.38 billion yuan in a single quarter, with a year-on-year increase of 33.4% ~ 35.2%, continuing the trend of rapid growth. The company continued to build an “integrated, end-to-end” crdmo service model and continued the trend of rapid growth. In addition, the laboratory analysis and testing business under Wuxi testing, clinical cro / SMO business, biology business and small molecule drug discovery service under chemical business also continued to maintain a strong growth momentum. Looking forward to the future, as the world’s leading integrated service leader of “drug discovery + preclinical research + clinical business and cdmo business”, the company will continue to benefit from the high outlook of the industry and continue to show rapid growth.
As a “big and strong” platform innovative drug service provider, it is expected that the performance will continue to maintain rapid growth in the next 5 ~ 10 years
Since its establishment in 2000, the company has continuously expanded its business scope and prospectively diversified its business layout. At present, it has become a global “big and strong” platform service provider. Looking forward to the next five years, even more than 10 years, the company’s core competitive advantage is the business scalability brought by platform enterprises, that is, the ability to expand industrial chain business in the future is the core concern to ensure long-term growth. Based on the two core businesses (laboratory business + cdmo business), the company actively distributes the cdmo field of cell and gene therapy, the innovative business ddsu, and the clinical cro field. It is expected that the performance will continue to maintain rapid growth in the next 5 ~ 10 years.
Investment advice
As a “big and strong” platform innovative drug service provider, the company has global business competitiveness, and the management team with Li Ge as the leadership core has the foresight of business layout and the ability to expand business. We judge that the company is a rare target with medium and long-term growth of a shares. Considering the changes of investment income and fair value and the strong and rapid growth of core business, the early-stage profit forecast was raised, that is, the revenue from 21-23 years was raised from 22.610/301.82/40.480 billion yuan to 22.854/305.17/40.943 billion yuan, and the EPS was raised from 1.91/2.72/3.46 yuan to 2.06/2.86/3.65 yuan, corresponding to the closing price of 117.80 yuan / share on January 18, 2022, and the PE was 60.65/43.65/34.16 times respectively, Maintain the “buy” rating.
Risk tips
The core technology backbone and management risk of loss, the risk of increased competition, growth strategy and business expansion risk of failure, core customer loss, exchange rate volatility risk, drug price reduction in the US market, and New Coronavirus epidemic affect the expansion of China’s external business.
