Performance continues to grow, revenue increased 13.7% in 2022
In 2022, the company achieved a 9.8% increase in turnover to RMB 9.15 billion. Based on pharmaceutical sales revenue, turnover increased 13.7% to RMB 10.498 billion, annual net profit increased 8.3% to RMB 3.276 billion, and basic earnings per share increased 8.6% to RMB 1.33 billion.
In the context of epidemic prevention and control, it has achieved continuous growth performance, thanks to the company's rich and competitive product line and strong commercialization team.
The company is actively expanding its innovation pipeline, and 3 major new drugs will soon be launched:
The company has deployed 30 innovative pipelines based on FIC and BIC globally. There are 4 innovative drugs in China's NDA review, and 3 will be approved within the year, respectively 1) Diazepam nasal spray: or it may become the first innovative drug for people with epilepsy aged six and above in China. Its China bridge trial has met the expected goals, and China's NDA is undergoing a CDE review. 2) Tirizizumab injection: Suitable for moderate to severe plaque psoriasis. The results of the bridging test in China were positive. It was approved for listing in Hong Kong, China in April 2022, and the Chinese NDA is under CDE review. 3) Methotrexate injection: The indications are RA and psoriasis. It can be administered subcutaneously. The Chinese marketing license application for psoriatic indications received priority review in January 2022. Dailixin began harvesting in 2022, and Boeidine and Yusfer are likely to start harvesting in 2023. However, since the company is about to launch new products, and the company's products on sale have a high brand power and the company's strong OTC channels, the company's performance is expected to maintain steady and rapid growth.
The dermatology and aesthetics business is progressing in an orderly manner, and the team is continuously strengthened:
Currently, Kangzhelei has a team of more than 600 people, and the product line continues to be enriched. The new lucotinib cream was introduced in 2022. It is the first and only topical JAK inhibitor approved by the US FDA and the only reactive vitiligo product. It has strong product strength, has been recognized by well-known experts in the industry, and has a broad market space. Products also include Dermatological Journal skincare products and hyaluronic acid and botulinum toxin products; the “Carnation” platform has launched three series of products, namely the FUBA-focused ultrasonic fat reducer, LITU focused ultrasound skin treatment device, and MEBA ultrasound transducer series.
Internationalize business development and focus on developing the Southeast Asian market:
The company will focus on the huge demand for pharmaceuticals in the Southeast Asian market, use Singapore as the management center, reach ASEAN countries such as Indonesia, the Philippines, and Vietnam, and fully enter the Southeast Asian market. For the first time, Chinese insulin products were promoted into Southeast Asia, and lucotinib will also enter the Southeast Asian market.
Our point of view:
The company's performance has continued to grow for more than 10 years, actively deploying innovative drugs. With an open innovation incubation platform, it has deployed 30 innovation pipelines centered on FIC and BIC globally. Of these, 4 are being reviewed by China's NDA, and 3 will be approved within the year. The company has developed in depth around specialty fields. It has independently operated the medical aesthetic “Kangzhe Beauty” and the ophthalmology “Kangzhe Weisheng” and entered the Southeast Asian market. The company's management has more than 30 years of experience in the pharmaceutical industry, expanding medical aesthetics and health based on innovative drugs. We expect the company's performance to continue to grow steadily in the future. The current stock price corresponds to 8.5 times PE in 2022. The value is seriously underestimated. Long-term development is worth looking forward to, and maintaining the “buy” rating.