Incidents:
Haohai Biotech released its 2023 performance forecast. It is expected to achieve net profit of 40-430 million yuan in 2023, an increase of 121.64%-138.27% over the previous year; net profit after deducting non-return to mother of 3.67 to 397 million yuan, an increase of 131.18% to 150.08% year on year. It is estimated that 23Q4 will achieve net profit of 0.73 to 103 million yuan in a single quarter, an increase of 291.00%-451.26% year on year; net profit after deducting non-return to mother of 0.62 to 92 million yuan, an increase of 241.13% to 405.06% year on year.
Comment:
Low base+business recovery, steady performance growth in 2023. In 2022, production and operation of the company and production subsidiaries located in Shanghai stagnated during the period of 3-5 months. Coupled with the accrual of goodwill and intangible assets for US subsidiaries in 22Q2 and 22Q4, the overall performance base for 2022 was low.
In 2023, along with the improvement in the external business environment and the recovery of terminal consumption, the company's various businesses have fully recovered, and the performance is fully flexible.
Hyaluronic acid growth is expected to be strong, while other sectors are performing steadily. By sector, 23Q4's hyaluronic acid is expected to maintain a high growth rate; the optoelectronic business is greatly affected by the domestic economic situation and international regional conflicts, and growth is expected to be stable; ophthalmology intraocular lens collection and implementation, with sales maintaining steady expectations; the size of the ophthalmology OK mirror market is growing rapidly, and demand for myopia prevention is strong, but market competition has intensified, compounding pressure on overall consumption capacity to maintain steady expectations.
Hyaluronic acid relays are being promoted, and the leading position in the industry continues to strengthen. The company's first-generation hyaluronic acid, Haiwei, has been on the market for more than ten years, and its performance is still stable; the second-generation Jiaolan is positioned in the middle, but has achieved a rapid breakthrough in lip indications; the third-generation Hyaluronic Acid is positioned as high-end, benefiting deeply from domestic substitution trends, and has excellent performance; the product is expected to be approved in the first half of '24. The product has differentiated technical advantages, and is superior to competitors in terms of injection effectiveness and safety, which will further drive the high performance growth in the hyaluronic acid sector.
Investment advice: The company's hyaluronic acid technology has deep advantages, and its differentiated product strength has been widely recognized by downstream customers. Along with new products and channel expansion, market share and profitability are expected to increase further.
Considering the increased competition in the company's ophthalmology sector and adjusted profit forecasts, revenue for 2023-2025 is estimated to be 2,527 million/2,948 million/3.485 billion, respectively, net profit to mother of 430 million/535 million/633 million, respectively, and the corresponding PE of Hong Kong stocks is 13 times/11 times/9 times, respectively, maintaining a “buy” rating.
Risk warning: industry competition is intensifying; policy supervision is becoming stricter; promotion of new products falls short of expectations; performance predictions and valuation judgments fall short of expectations.