Events:
On the evening of October 21, the company released its results for the first three quarters. The company achieved operating income of 1.078 billion yuan in the first three quarters, an increase of 40.38% over the same period last year after performance adjustment. The net profit returned to the home was 354 million yuan, down 4.89% from the same period last year. Basic earnings per share were 0.65 yuan per share, down 4.41% from the same period last year.
The falling price of VD3 puts pressure on profits, and profitability is expected to rebound.
In 2022, Q3 achieved a quarterly net profit of 278 million yuan, an increase of 8% over the same period last year and a decrease of 33% compared with the previous year, mainly due to a sharp decline in the price of ordinary VD3, the company's traditional products. In 2022, the average price of Q3 domestic VD3 (500000 IU/g) was 64 yuan / ton, down 32% from the same period last year and 20% from the previous month.
The historical price of VD3 is relatively flexible. In 2008-09, the price of VD3 rebounded from 54 yuan / ton to 177yuan / ton; in 16-17, 98 yuan / ton anti-lattice projectile reached 12207 yuan / ton 4 yuan / ton. From V cut D3 to October 20, 2002, the VD3 price has fallen to 57 yuan / ton to a 10-year low, deviating from the central price by more than 50%. We expect the ordinary VD3 market to usher in a strong rebound after deep cleaning, which will greatly improve the profitability of the company's VD3 business.
25-hydroxy logic VD 3 is put into production. High barrier and high growth companies are the leading enterprises of traditional VD3 and cholesterol, with the layout of the whole industry chain of lanolin-NF cholesterol-VD3/25- hydroxyl VD3. The unique chemical synthesis technology of the company's 25-hydroxy VD3 and the large-scale production of NF cholesterol complement each other. The unique 24-dehydrocholesterol purification technology, the cost advantage of the whole industry chain and the limited NF cholesterol market build a strong barrier to entry for the 25-hydroxy VD3 industry.
In September 22, Jinxi Science and Technology Park 15.6t 25-hydroxy VD3 crystal has been completed and put into production, and the company's industrial advantage is stable, waiting for the downstream feed and health products market of 25-hydroxy VD3 to continue to open.
The company continues to distribute fully active VD3 as ossifying alcohol drugs downstream, which has a large market space in the areas of osteoporosis, psoriasis and renal dialysis, and is expected to further open the company's growth limit.
Earnings forecast, valuation and rating
We maintain our previous profit forecast that the company's net return profit for 2022-24 is expected to be 5.10 PE 6.45 / 797 million yuan respectively, with a corresponding growth rate of 6%, 26%, 24%, respectively, and the current share price corresponding to EPS is 19%, 1.45% and 19%, respectively. In view of the company's strong barriers to entry and clear growth, we maintain the target price of 23.25 yuan and maintain the "buy" rating.
Risk hint: 25-hydroxy VD3 market is not advancing as expected, 25-hydroxy VD3 production technology is iterative
