Deep ploughing industry for many years, domestic preclinical integration CRO company. The company's services cover the whole process of preclinical new drug research and development, including drug discovery, pharmaceutical research and preclinical research. The performance maintained high growth in the past 22 years, with an income of 1.659 billion yuan (+ 42.1%), a net profit of 338 million yuan (+ 19.8%), and a net profit of 307 million yuan (+ 13.3%), mainly due to the income growth of various businesses. the recognition of customers and the market to the company's R & D service capability continues to improve.

There are plenty of newly signed orders, and overseas business is expected to contribute to performance flexibility. The newly signed order of the company in 22 years is 3.458 billion yuan (+ 41.0%), laying the foundation for future performance growth; the company has added 380 customers in 22 years, the cumulative number of customers has exceeded 1840, and the service scope continues to expand. The employee side continues to rise, and per capita output is expected to continue to rise. In 22 years, overseas business achieved operating income of 398 million yuan (+ 53.9%), corresponding to a gross profit margin of 42.1% (+ 0.1pcts), drug discovery and pharmaceutical research income of 271 million yuan (+ 50.2%), and preclinical research income of 126 million yuan (+ 62.5%), which is expected to continue to contribute to performance elasticity.

Strengthen R & D investment and extend the development of integration strategy. The company has developed and established multi-disciplinary new drug R & D technology platforms for many years, including PROTAC, ADC, nucleic acid drugs and other R & D platforms, and continues to increase R & D investment and strengthen the construction of new drug R & D key technology research and innovative R & D technology platform. Development strategy: the company already has the comprehensive integrated R & D service capability of drug discovery, pharmaceutical research and preclinical research in the field of chemical drug R & D, ① is expected to expand to the field of biomedical preclinical research, ② will strengthen the competitiveness of existing business and international business development, and ③ will follow up complementary acquisition and merger development in the field of CMO/CDMO.

Profit forecast and rating: in 23-25, the company's revenue is expected to be 22.12 million 2.802 billion yuan, up 33.3%, 26.7% and 23.0%, respectively, and its net profit is 4.60 / 6.19 / 777 million yuan, up 36.1%, 34.4% and 25.5%. With reference to the relative valuation, the company's business belongs to preclinical CRO research, business development and performance growth, giving the company 28 times PE in 2023, corresponding to 12.9 billion yuan, with a target share price of 95.84 yuan. Coverage for the first time, giving a "overweight" rating.

Risk hint: the risk that the growth rate of the drug R & D market is lower than expected, the risk of the deterioration of the competition pattern in the industry, and the risk that the progress of production capacity investment is lower than expected.