Large peptide products are appearing frequently, and the industrial chain is on the cusp. Polypeptide drugs are more efficient, safe, tolerable and highly selective than macromolecule drugs, and have advantages in terms of quality, purity, and cost. The treatment field of polypeptide drugs is mainly chronic diseases. In recent years, GLP-1 target drugs such as simeglutide and telpotide have expanded their indications to the field of weight loss. Sales have grown rapidly, bringing great attention from the industry and society, and driving the peptide industry chain into a period of rapid development. According to Frost & Sullivan data, the domestic peptide raw material industry market is expected to grow by 7.62 billion yuan in 2021 to 2025 At 23.75 billion yuan in the year, the compound growth rate is as high as 32.9%. The scale of peptide CDMO will grow from 1.3 billion yuan in 2021 to 5.67 billion yuan in 2025, with a compound growth rate of 44.5%.
The layout is early, the technology is strong, the production capacity is high, and the company is developing well. Years of layout and rich products: The company has been working in the field of APIs for many years, and the team has been deeply involved in peptides for 20 years. As of May 20, 2024, the company has obtained domestic registration for 18 active drug types, FDADMF/VMF numbers for 15 active drug types, and 7 formulations approved for marketing. Advanced technology and innovative layout: After years of research and development, the company has built multiple technology platforms, and the single batch output of simeglutide produced using a large-scale peptide production technology platform based on solid-liquid fusion exceeds 10 kg, reaching the advanced level of the industry; in addition to generic drugs, the company actively lays out innovative drug business, and a class of new drug SPN0103-009 injections have obtained clinical trial approval notices. Building up production capacity and increasing barriers: Since the peptide industry has received a lot of attention and layout in the short term, companies with high-quality production capacity are more competitive. The company's production capacity of polypeptide APIs in Lianyungang has now reached tonnage. The company expects the production capacity of peptides under construction to be launched in 2025, and the production capacity of peptide APIs will reach several tons by the end of 2025, and production capacity investment is expected to lead to an increase in sales volume.
Profit forecast and investment rating: We expect the company's revenue for 2024-2026 to be RMB 1,385/18.62/ RMB 2,527 billion, respectively, with growth rates of 34.0%, 34.5%, and 35.7% respectively, and net profit to mother of RMB 2.12/3.02/423 million, respectively, with growth rates of 29.9%, 42.5%, and 40.3%, respectively. The current stock price corresponds to 2024E-2026E PE of 58.4x, 41.0x, 29.2x, respectively. As a leading company for peptide APIs, the company has benefited from the boom in industry development brought about by GLP-1 target drugs. The release of peptide production capacity is expected to drive independent product selection and release, giving it a “buy” rating for the first time.
Risk factors: macro-environmental risk, financial risk, industry risk, business risk, R&D failure risk, loss of core technical personnel, etc.