In-hand orders are growing rapidly, and there is a high degree of certainty that performance growth will increase
The company released its 2022 annual report, achieving revenue of 479 million yuan in 2022, an increase of 6.84% over the previous year; Guimo's net profit was 67 million yuan, down 8.70% from the previous year; after deducting non-Gumo's net profit of 63 million yuan, a year-on-year decrease of 10.81%.
2022 was greatly affected by the epidemic. The revenue side growth rate slowed. The company increased business expansion and deployed cutting-edge technology platforms. Sales and R&D expenses increased a lot, and the profit side was under pressure. By the end of 2022, the company's on-hand orders reached 365 million yuan, an increase of 54.22% over the previous year. In-hand orders were plentiful, and performance growth was highly certain. The company excels in small molecule drug design and has established deep partnerships with overseas high-quality biotech companies to help customers develop a variety of FIC drugs. At the same time, the competition pattern for the company's main commercial varieties is good, and patents are in the expiry stage one after another, and customer demand is expected to continue to increase. In view of slowing industry demand, we lowered the 2023-2024 and added the 2025 profit forecast. We expect the 2023-2025 company's net profit to be 1.14/172/244 million yuan (originally estimated at 119/186 million yuan), EPS is 1.49/2.24/3.18 yuan, and the current stock price corresponding to PE is 40.3/26.8/18.9 times, considering that the company's various business lines are rapidly expanding and maintaining the “buy” rating.
Continuously strengthen R&D capabilities and continuously help customers develop FIC drug companies to continuously enhance their R&D capabilities. In 2022, R&D investment reached 33 million yuan, with a 3-year compound growth rate of 66.14%; the number of R&D personnel reached 669 by the end of 2022, accounting for 68.06%. The company takes small-molecule drug design with high technical barriers and low homogenization competition as a starting point, deeply participates in customer new drug research and development, and continuously strengthens cooperation with biotech at home and abroad. By the end of 2022, the company had delivered a total of 33 drug candidates (+12) to customers, including 27 FIC projects, accounting for 81.82%. Of these, 4 have been approved for marketing.
Business development continues to be strengthened, and business capabilities are continuously improved
The company stepped up its business development efforts. In 2022, it participated in 11 domestic and international exhibitions/forums. By the end of 2022, the number of active CRO/CDMO customers was 135, an increase of 50% over the previous year; there were 132 active commercial production customers (+21), and the company's on-hand orders reached 365 million yuan, an increase of 54.22% over the previous year. The company set up Hongbo Shangyi to undertake the development function of the CDMO business; set up Chengdu Hongbo to expand the production capacity of the drug discovery business and plan pharmacokinetics and pharmacodynamics research platforms to collaborate with the company's existing business and improve business capabilities.
Risk warning: declining demand in the drug development market, loss of core members, production capacity falling short of expectations, etc.