Core logic: 1) The company is deeply tied to herding, a leading domestic pig breeding and slaughter enterprise, and lays out upstream high-quality traceable raw materials, which is of great strategic significance; 2) the company's enoxaparin sodium is expected to use collection to achieve price in exchange for quantity, and the company's enzyme preparation products have the highest market share; 3) the company's innovative drug pipeline is progressing steadily, and development has entered a high-quality stage.
The API business is deeply tied to high-quality upstream resources, and the future can be expected. The company is a leading domestic heparin API; Muyuan is a leading domestic pig breeding and slaughter enterprise, with a pig breeding capacity of over 78 million heads per year, and a total slaughter capacity of 29 million heads per year. In January '23, the company and Muyuan set up a subsidiary, Henan Qianmu, to deeply bind Muyuan's high-quality pork intestines resources. The strong combination of the two is of great strategic significance, helping to develop high-end API customer demand and achieve rapid growth in export business.
Heparin preparations use collection for price in exchange for quantity, and enzyme preparations rank among the highest in the domestic market share. Heparin preparations: The company's injectable heparin sodium ranked first in sales at public hospitals. The company's enoxaparin sodium won the bid for the eighth batch of collection. The company's share of 23H1 public hospital sales was only 3.4%. It is a barefoot variety that is expected to achieve price in exchange for volume through collection, leading to an increase in performance. Enzyme preparations: Pancreatin proenzyme accounts for the first share of sales in public hospitals, and compound digestive enzymes rank third. It is expected to achieve steady growth in the future.
Laying out innovative drug pipelines, the company has entered a stage of high-quality development. The company lays out innovative drug pipelines to open up space for long-term growth. Currently, QHRD107 is in phase II clinical trials to treat acute myeloid leukemia; QHRD106, an injection targeting KLK, is used to treat ischemic stroke. Currently, phase I clinical trials have been completed in China, and phase II clinical trials are about to begin; QHRD211, GH-targeted injections to treat growth hormone deficiency, have now completed phase I clinical trials in China, and are about to begin phase II/II clinical trials; QHRD102, for the treatment of acute lymphocytic leukemia; NK/T cell lymphoma, currently in phase I in China clinical stage. Additionally, QHRD110 capsule is a small molecule CDK4/6 inhibitor. The proposed indication is advanced malignant solid tumors, and has been approved for clinical trials.
Investment suggestions: The company is a leading domestic company in heparin APIs and enzyme preparations. The heparin API business is deeply tied to Muyuan shares, a leading domestic pig breeding and slaughter company. It is expected that in the future, it is expected to develop high-end API customers, which will drive the improvement of the profitability of the API business. Heparin preparations rely on collection volume, and enzyme preparations rank in the domestic market ranking. The company's net profit for 23-25 is expected to be 2.5/33/ 3.9 billion yuan, respectively, with a year-on-year growth rate of -22.5%/29.9%/18.5% respectively, coverage for the first time, “Buy” rating.
Risk warning: risk of falling product sales price, risk of falling profit, risk of increasing operating costs