\u3000\u3000 Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) (603392)
Event overview
The company issued the announcement of annual performance increase in 2021. In 2021, the company expects to realize a net profit attributable to the parent company of RMB 1.850-2.050 billion, with a year-on-year increase of 173% – 203%; It is expected to realize a net profit of RMB 1.777-1.970 billion, a year-on-year increase of 188% – 220%.
Analysis and judgment:
The company’s performance greatly exceeded expectations, the bivalent HPV sales continued to increase in large quantities, and the in vitro diagnostic business continued to grow high under the influence of covid-19
We had previously estimated that the company’s net profit in 2021 was RMB 1.613 billion, but in fact, according to the calculation of the median value of the above pre increase range of the company’s performance forecast, it was significantly higher than the expectation, and the range of exceeding the expectation was as high as 20%. In 2021, the company’s performance greatly exceeded expectations, mainly due to the company’s continued booming production and sales of bivalent HPV vaccine, and the rapid growth of revenue and profit. At the same time, as the covid-19 pneumonia epidemic has not been effectively controlled, the demand for overseas testing has increased significantly, and the company’s covid-19 raw material sales and overseas testing reagent export revenue have increased rapidly. According to the batch issuance data of China Academy of inspection in 2021, it is estimated that the batch issuance volume of bivalent HPV vaccine of the company will exceed 10 million in 2021. Considering that the supply of HPV vaccine in China is in short supply, we expect the sales volume to be about 10 million in 2021, exceeding the market expectation. In terms of net profit, we expect and calculate that the vaccine sector contributes a net profit of nearly 1.1 ~ 1.2 billion yuan, which exceeds the previous expectation. We expect that with the significant increase of the company’s HPV vaccine sales in 2021, the sales expense rate and net profit margin will increase significantly, both exceeding the previous expectation. With the continuous rapid growth of HPV vaccine sales in 2022 and 2023, We expect this trend to continue significantly.
The scale of China’s HPV vaccine market is far from reaching the peak. The company’s products have vaccination advantages and price advantages, and will continue to grow rapidly and in large quantities
According to the calculation of the number of HPV vaccine batches issued by the Central People’s Procuratorate, a total of 20 million people in China have completed the whole process of HPV vaccination from 2017 to 2021. There are about 381 million women aged 9-45 in China. At present, the penetration rate of HPV vaccination among school-age women in China is only about 7%. According to the penetration rate of 30% / 45% / 60%, China still needs 280 / 4.5 / 620 million HPV vaccines, which is far from reaching the peak. If Chinese male indications are approved in the future, there will be more space. The bivalent HPV vaccine of the company is given 2 injections for 9-14 years old and 3 injections for imported products. The company’s products have the advantage of immunization program. At the same time, compared with imported products, the price advantage of the company’s products is very significant. The whole process immunization cost of the “two needle method” for young people is 38% of the imported second price, and the whole process immunization cost for people over 15 years old is 56% of the imported second price. The price difference is higher than that of imported four price and nine price. The company’s pricing has fully considered the issue of accessibility. The lower pricing has opened the gap with imported products, which has increased the people’s willingness to pay for HPV vaccine. At present, the supply of HPV vaccine in China is in short supply. Multiple factors promote the company’s HPV vaccine to continue high-speed and large-scale production in the future.
Investment advice
Considering that China’s HPV vaccine is still in an unbalanced state of supply and demand, the company’s bivalent HPV vaccine will grow rapidly and in large quantities. On this basis, the company’s bivalent HPV vaccine sales scale effect is significant, and the sales expense rate has a significant downward trend. We raised the company’s profit forecast. Temporarily maintain the forecast of HPV sales volume and operating revenue, reduce the sales expense rate and increase the net profit attributable to the parent company. It is estimated that from 2021 to 2023, the operating revenue of the company will be RMB 5.192 billion, RMB 8.668 billion and RMB 12.001 billion, with a year-on-year increase of 120.5%, 67.0% and 38.5%; The net profit attributable to the parent company increased from RMB 1.613 billion, 2.902 billion and 4.535 billion to RMB 1.913 billion, 3.134 billion and 4.802 billion, with a year-on-year increase of 182.6%, 63.8% and 53.2%. EPS is 3.15, 5.16 and 7.91 yuan, corresponding to the share price of 222.00 yuan / share on January 20, 2022, and PE is 70 / 43 / 28 times, maintaining the “buy” rating.
Risk tips
The company’s bivalent HPV vaccine sales are less than the expected risk; With the market competition of other domestic HPV vaccines in China, the risk of product price reduction is intensified; The company’s in vitro diagnostic business sales are less than expected risks; The company’s vaccine research and development progress is less than the expected risk.
