\u3000\u3000 Joinn Laboratories (China) Co.Ltd(603127) (603127)
Event overview
The company announced the performance forecast of 2021 annual report: the annual net profit attributable to the parent company was 543 ~ 574 million yuan, with a year-on-year increase of about 72.3% ~ 82.3%; The non net profit deducted was 516 ~ 547 million yuan, with a year-on-year increase of about 76.6% ~ 87.4%.
Analysis and judgment:
The performance continues to grow at a high speed, and it is expected to maintain high growth in the future
In 2021, the company achieved net profit deduction of 516 ~ 547 million yuan, with a year-on-year increase of 76.6% ~ 87.4%, of which Q4 achieved net profit deduction of 298 ~ 330 million yuan in a single quarter, with a year-on-year increase of 54.2% ~ 70.5%, and the performance significantly exceeded the market expectation. Considering the high-speed growth of newly signed orders in 2020 and the first three quarters of 2021, we judge that the revenue end of the company will continue to show high-speed growth in 2021. Looking forward to the future, considering the ultra-high growth of newly signed orders in the first three quarters of 21 years and the continuous production of Suzhou new production capacity and Hong Kong stock raised investment projects, we judge that the company will continue to achieve ultra-high growth in 2022 and the next three years.
The multi-point layout deeply cultivates China’s safety evaluation market, and the internationalization strategy brings about the expansion of market space
Looking forward to the future, the company will achieve sustainable business growth through deep cultivation in the Chinese market and international business expansion:
Joinn Laboratories (China) Co.Ltd(603127) based on the safety evaluation centers in Beijing and Suzhou, issue H shares to raise funds and prepare for the new safety evaluation centers in Chongqing and Guangzhou, so as to realize the national regionalized multi-point layout and capacity expansion, and meet the company’s medium and long-term capacity needs; Through the regional network layout and continuous improvement of production capacity, the company has deeply cultivated China’s safety evaluation market and realized the continuous improvement of penetration rate;
The company established Zhaoyan California in the United States in June 2013, responsible for the market expansion of international projects, and successfully realized the consolidation of biomere in the United States in December 2019. In the future, with the help of the American biomere platform, accelerate the expansion of the international market and realize the expansion of market space, that is, expand from China’s “small market of 5 billion yuan” to the global “large market of 4.5 billion dollars”, so as to support the sustained and rapid growth of the company’s medium and long-term performance.
Normalization of employee equity incentive to realize the binding of employee interests and company interests: the company has implemented a large-scale equity incentive plan for senior management team and core technicians for four consecutive years from 2018 to 2021, which can better attract and retain talents, encourage core employees to grow together with the company, realize the binding of employee interests and company interests, and benefit the medium and long-term rapid growth of the company.
Investment advice
As the largest leader of drug safety evaluation in China, the company will deeply cultivate China’s safety evaluation market through regional multi-point layout in the future, and realize the coordinated development of business outside China with the help of American biomere platform. We judge that in the next 3-5 years, the company will benefit from the prosperity of innovative drug research and development in China and the expansion of market space brought by internationalization to maintain rapid growth. Slightly raise the early-stage profit forecast. It is expected that the operating revenue will be increased from RMB 1517 / 2137 / 2875 million to RMB 1517 / 2137 / 3048 million from 2021 to 2023, and the EPS will be adjusted from RMB 1.15/1.57/2.06 to RMB 1.46/2.05/2.68, corresponding to the closing price of RMB 96.6/share on January 22, 2022, and the PE will be 66.03/47.04/36.04 times respectively, maintaining the “buy” rating.
Risk tips
Risk of loss of core technical backbone and management; The risk of increased competition; There is a risk of failure in capacity expansion, internationalization strategy and business expansion; The impact of New Coronavirus epidemic.
