Incidents:
Recently, the company announced that it has acquired the former Pfizer UK Sandwich Site and completed the layout of the company's first European R&D and production base.
Acquired the former Pfizer UK Sandwich Site to strengthen overseas CDMO supply capacity:
The company has obtained the API Pilot Plant and R&D Laboratory from the former Pfizer Sandwich Site in the UK, and completed the layout of the company's first European R&D and production base. The company is expected to rely on Sandwich Site to strengthen the supply capacity of the overseas CDMO business from laboratories and pilot tests to commercialization, and is also expected to further develop emerging business fields such as peptides, nucleic acids, and enzyme technology. This layout will help the company rapidly expand overseas customers, and it is optimistic that the company will continue to receive more high-quality overseas orders.
Macro and micro fundamentals have improved marginally, and I am optimistic that the company will continue to develop steadily:
Combining macro and micro analysis, we believe that the fundamentals of the CXO industry and the company are showing a trend of marginal improvement, and we are optimistic that the company will continue to develop steadily. Among them, at the macro level, according to Crunchbase data, 2024Q1 global and US innovative drug VC&PE investment and financing increased by 2.86% and 8.54%, respectively, and the growth rate of 2024Q1 innovative drug investment and financing resumed positive growth, and the innovative drug investment and financing environment is expected to continue to improve; at the micro level, after excluding the impact of large orders in 2023 and 2024Q1, the company's revenue increased 24.37% and 15.21% year on year, respectively, and regular business maintained steady growth. The company is expected to maintain steady development in view of the gradual decline in the high base effect of major orders, continued steady growth in conventional business, and positive boost in emerging businesses such as peptides.
Investment advice:
The company's net profit from 2024 to 2026 is estimated to be 1,265 billion yuan, 1,514 billion yuan, and 1,789 billion yuan, respectively, up -44.3%, 19.7%, and 18.2% year-on-year; EPS is expected to be 3.42 yuan/share in 2024, 30 times the current PE, corresponding to a 6-month target price of 102.60 yuan/share, giving a buy-A investment rating.
Risk warning: Order growth falls short of expectations, order delivery falls short of expectations, development of emerging businesses falls short of expectations, industry sentiment falls short of expectations, risk of overseas policy changes, etc.