\u3000\u3000 Asymchem Laboratories (Tianjin) Co.Ltd(002821) (002821)
Event: on January 25, 2022, the company released the performance forecast for 2021. In 2021, the company is expected to realize an operating revenue of 4.51-4.66 billion yuan, a year-on-year increase of 43.0% – 48.0%; The net profit attributable to the parent company was 1.04-1.08 billion yuan, with a year-on-year increase of 44.0% – 49.0%; The non net profit deducted was RMB 910-940 million, with a year-on-year increase of 41.0% – 46.0%.
The performance exceeded expectations, Q4 performed strongly, and the acceleration trend is expected to continue. In 2021, the company expects to achieve a median revenue of about 4.58 billion yuan (+ 45.5%), a median net profit attributable to the parent company of about 1.06 billion yuan (+ 46.5%), and a median net profit of about 920 million yuan (+ 43.5%), which continues to perform well. We expect that the main factors are: ① small molecule cdmo continues to be strong, the global competitive advantage of the company’s small molecule cdmo business is prominent, and orders continue to be strong. With the acceleration of production capacity in the second half of the year, it is expected that the annual small molecule cdmo business will increase by more than 45% year-on-year, of which Q4 will increase by more than 65% year-on-year; ② New businesses have entered the fast lane, and the annual revenue of emerging business segments is expected to increase by more than 65% year-on-year. Quarter by quarter, the median revenue of 2021q4 is about 1.66 billion yuan (+ 55.7%), the median return to parent is about 360 million yuan (+ 68.2%), and the median net profit deducted is about 330 million yuan (+ 75.0%), which continues to hit a record high. In addition, due to the slight fluctuation of the average exchange rate between us dollar and RMB in 2021 compared with that in 2020, which has caused some disturbance to the company’s revenue, we expect that after excluding the impact of exchange rate, the annual and 2021q4 revenue will increase by 52-57% and 62-67% respectively, the annual and 2021q4 revenue of small molecule cdmo will increase by about 50% and 70% respectively, and the annual growth of emerging businesses will increase by about 70%.
Capacity expansion is accelerated, and small molecule cdmo is expected to speed up. With its leading continuous flow chemistry, enzyme catalysis and other technical advantages, the company has undertaken a large number of preclinical to commercial small molecule cdmo projects. Among them, 17 of the later clinical and commercial projects are expected to be heavy varieties exceeding US $1 billion. The renewal of large orders highlights the strong business demand. In order to meet the supply demand, the company accelerates the expansion of production capacity. In 2021h1, the company’s production capacity is about 2979.8m3 (+ 24.2%), and it is expected to release new production capacity in Tianjin, Dunhua and Zhenjiang in the second half of the year and next year. The production capacity is expected to reach 4369.8m3 (+ 56.1%) and 5869.8m3 (+ 34.3%) by the end of 2021 and 2021h2 respectively. It is expected to add about 1390m3 in 2021h2. The release rhythm is accelerated, which is expected to drive the accelerated growth of small molecule cdmo.
The continuous layout of multi fields and the whole industrial chain is expected to bring new growth momentum. Relying on the customer base, technical details and operation platform management system accumulated by small molecule business for many years, the company has built its own cdmo platform for chemical synthetic macromolecules, bioengineering, preparations and biological macromolecules, acquired Guanqin medicine and yipukono, integrated preclinical and clinical cro business, and provided customers with whole process integrated outsourcing services. With the continuous development of new business areas, it is expected to contribute new increments to the company.
Profit forecast and investment suggestions: we predict that the company’s revenue from 2021 to 2023 will be 4.118, 5.372 and 6.975 billion yuan, with a year-on-year increase of 30.73%, 30.47% and 29.83%, and the net profit attributable to the parent company will be 970, 1.290 and 1.711 billion yuan, with a year-on-year increase of 34.38%, 32.96% and 32.66%. Considering that the company is in a high boom and high-quality track of innovative drug R & D and production outsourcing, and has become China’s cdmo leader with comprehensive advantages such as technology, leading the rapid growth of the industry, it is expected to enjoy the valuation premium and maintain the “buy” rating.
Risk warning events: the public materials used in the research report may have the risk of information lag or untimely update, and the loss of core technicians; Risks of raw material supply and price rise, environmental protection and safety production risks; Exchange rate fluctuation risk.
