Summary of the report:
The restructuring introduced high-quality pharmaceutical assets, and the performance of the original chemical sector was stable. The company was listed in backdoor Wanchang Technology on October 20, 2015, and placed high-quality biomedical assets on the basis of the former Wanchang Science and Technology Fine Chemicals. Including Xiamen Weiming (rat nerve factor), Tianjin Weiming (interferon) and the shareholding company Beijing Kexing (vaccine), the company's profitability and product competitiveness have been greatly improved after the restructuring. The former chemical business has achieved stable performance in recent years, contributing stable cash flow to listed companies.
The EV71 vaccine released rapidly after it was put on the market, which significantly thickened the company's performance. Due to the impact of the Shandong vaccine incident, Beijing Science and Technology lost a lot of money in the first half of 16 years. After the EV71 vaccine was put on the market in June, it released rapidly, with a batch of 4.6 million doses in seven months. In the future, with the increase of vaccine stock and incremental market penetration, we predict that Beijing Kexing EV71 vaccine will achieve a net profit of 375 million, 533 million and 632 million in 2017-2019. Based on the company's 26.91% stake, the performance contribution of 101 million, 143 million and 170 million yuan will increase significantly in the next three years.
The expectation of privatization is strong, and the return time of Sinopec Holdings is approaching. In February 16, after the unnamed buyer group and the high-level Kexing buyer group issued the privatization invitation, the privatization process progressed steadily and the situation gradually became clear. We believe that the future privatization will be completed by the unnamed buyer group on the basis of deep cooperation between the two sides, and the asset injection of the listed company will be completed recently. judging from the current sales of EV71 vaccine, the company's performance will be greatly improved in the future.
The injection of assets from unknown groups is expected to be strong. Weiming Group promises that Weiming Pharmaceutical will be the group's only pharmaceutical asset listing platform, and once Anhui Weiming (monoclonal antibody, cellular immunity) and Jiangsu Weiming (insulin) pharmaceutical assets make profits, they will be injected into listed companies. At the same time, the Group's assets include not only Anhui and Jiangsu, but also Beidaihe Health City (Industrial Park) and Xiangya Health Valley (medical services). Weiming Pharmaceutical is expected to undertake more high-quality assets of the group in the future, with its own growth and coordinated development through capital operation.
Company profit forecast and investment rating. The company's main performance is sound, the EV71 vaccine volume of the participating companies is obvious, and the privatization and group injection expectations are strong. Regardless of the future privatization asset injection, we expect the net profits of shareholders belonging to listed companies in 16-18 to be 421 million yuan, 549 million yuan and 685 million yuan respectively, with growth rates of 68%, 31% and 25% respectively, and earnings per share of 0.64 yuan and 1.04 yuan respectively. According to the segment valuation method, the reasonable market capitalization from 17 to 18 years is 16 billion and 20.4 billion respectively, corresponding to the 18-year target price of 30 yuan. at the same time, if we consider the future turnaround of interferon plate, the expectation of privatization of Sinopec and the injection of group assets in the future, the company's current market value has more flexibility. Coverage for the first time, giving the company a "highly recommended" rating.
Risk hints: rat neurokines are lower than expected; privatization process is blocked