Event: the company released its semi-annual report of 2022, with a revenue of 629 million yuan (yoy+5.7%) in the first half of the year, a net profit of 2.9 million yuan (yoy-95.23%), and a net profit of 3.38 million yuan (yoy-93.62%).
Comments:
(1) the market share of core products ranks first, and the overseas sales growth accelerates the company's 2022H1 homing net profit decreased by 95% compared with the same period last year. The main reasons are: 1) R & D expenses are 79 million yuan, which is a substantial increase over the same period last year (yoy+87.11%); 2) labor, depreciation, fuel power and other costs have increased, resulting in an increase in overall operating costs.
The company's core products include human erythropoietin, human interferon α 1b, human granulocyte stimulating factor and Clostridium butyricum live bacteria. According to the statistics of Mine.com, the company ranked first in the market share of human interferon for short-acting injection in 2021, with a market share of 30.33%, and erythropoietin ranked second in the domestic market share of erythropoietin in 2021, with a share of 13.17%. 2022H1 sales increased by 9.5% and 7% respectively, continuing to maintain its dominant position in the market. Sales in 2022H1's overseas markets rose 27.5 per cent year-on-year, with sales in the core markets Brazil and Egypt up 100 per cent and 23 per cent, respectively.
(2) rich experience in overseas sales and clear internationalization path
In terms of international layout, the company has more than 20 years of overseas sales experience. Through the introduction of overseas products, the company includes Invliximab, albumin paclitaxel and bevacizumab. Infliximab for injection (with exclusive commercial license rights in all countries and regions except Japan, Europe and North America) has now submitted registration documents in 13 countries, and in the second half of the year, the company will submit registration documents in 12 countries. China has been sold in 32 provinces, covering more than 100 hospitals. The high-end complex preparation albumin paclitaxel (technology transfer and marketing license outside the US market) has been accepted by NMPA and EMA. Bevacizumab (exclusive commercial licensing rights in countries and regions other than China, the European Union, the United Kingdom, the United States and Japan) has now launched product registration in 11 countries. In addition, the company has set up wholly-owned subsidiaries in Singapore, Mexico, Egypt, Brazil and other regions to promote overseas commercialization.
(3) the R & D pipeline has been accelerated, and the clinical trial of COVID-19 oral drug SHEN26 of Phase I clinical cooperation between SHEN26 and Antaiwei Biology was approved in July 2022. The project has been included in the 2021 emergency project of the Ministry of Science and Technology of Guangdong Province to prevent and control novel coronavirus infection, and it is also a special key promotion project of the Ministry of Science and Technology, public safety monitoring and emergency technology and equipment. At the same time, the company and Xinlitai signed SHEN26 CDMO technical services and commissioned production agreement to achieve complementary advantages.
The company cooperates with senior experts in genetic engineering to establish Kexing Animal Protection Company to lay out genetic engineering vector vaccine technology and promote the research and development of breakthrough animal vaccine products. Before the project, Kexing Animal Insurance has completed the establishment of 17 R & D pipelines and the construction of carriers around the direction of pet vaccine and economic animal vaccine. 90% of the pet vaccine market is occupied by imported products, and the core of the company's technology is carrier vaccine, so there is more room for import substitution.
Profit forecast: according to the company's business situation, regardless of the new crown oral medicine business, we estimate that the total revenue in 2022-2024 will be 1.431 billion, 1.678 billion and 1.981 billion respectively; the return net profit will be 62 million, 106 million and 179 million respectively, and the corresponding PE will be 78 times, 45 times and 27 times respectively. Cover for the first time and give a "recommended" rating.
Risk tips: the risk of increased product competition; the progress of research and development is not as expected; the risk of repeated epidemic; the risk of collection and other policies.