Southwest Securities issued a research report that the bank was the first to$Genscript Biotech Corporation (01548.HK) $Buy ratings for the following reasons:
1) the company is the global leader in gene synthesis, with a global market share of more than 30%, opening up long-term space for downstream incremental business diversion and high value-added business; 2) booming biology is the company's biological drug CDMO platform, biological drug CDMO: provides antibody drug development life cycle CDMO services; GCTCDMO: domestic plasmid leader, is one of the most experienced CDMO enterprises in domestic GCT project. 3) Cilta-cel (trade name: Carvykti ®) jointly developed by Yang Sen and Legend Biotech Corp was approved to be listed in the United States on February 28, 2022 and conditionally approved by the European Union on May 6. It is the first domestic CAR-T product approved by FDA. Its clinical data are eye-catching, safe and controllable, and may provide a more frontline treatment for r/rMM.
The life science business is the basic development of the company, the traditional business of gene synthesis is growing steadily, the incremental business such as protein, antibody, peptide and primer is rising, and the high barrier business such as reagent, instrument and equipment opens a new growth curve. According to the company's performance presentation data, the global potential market for life sciences is US $12 billion in 2021 and is expected to reach US $30 billion in 2028. Kingsley's life sciences business realized revenue of $320 million (+ 26.4%) in 2021 and gross profit of $180 million (+ 10.9%). The development logic of the company's life science business is clear, extending from traditional gene synthesis to downstream incremental business such as polypeptides, proteins and antibodies, expanding product types and promoting capacity and automation construction at the same time. Derivative high value-added equipment business is expected to become a new growth point.
From 2022 to 2024, the bank expects operating income of 6.8max 12 / 2.16 billion and net profit of-260 million /-170 million / 10 million, respectively. According to the segment valuation method, a reasonable market capitalization of HK $118.504 billion is given in 2023, with a corresponding target price of HK $56.06.