Incident: The company released its 2024 mid-year report. During the reporting period, it achieved operating income of 0.241 billion yuan, an increase of 9.44% over the previous year; realized net profit to mother - 0.067 billion yuan; and realized net profit not deducted from mother - 0.072 billion yuan.
Donafinil and recombinant human thrombin began to contribute revenue, while gicaxitinib and recombinant human thyroid-stimulating hormone entered the cash phase. Among the company's mature varieties, donafinil and recombinant thrombin began to contribute revenue. In the first half of 2024, the company achieved revenue of 0.241 billion yuan, an increase of 9.44% over the previous year; in addition, the company has received commercialization cooperation and milestone payments of 0.34 billion yuan for recombinant human thrombin, of which 0.28 billion yuan was received during the reporting period. Furthermore, the JAK inhibitor gikaxitinib tablets have been indicated for myelofibrosis in the NDA stage, phase 3 clinical trials have been completed for severe alopecia areata, and phase 3 clinical indications for moderate to severe atopic dermatitis, ankylosing spondylitis, and non-segmental vitiligo are progressing smoothly; recombinant human thyroid-stimulating hormone has been submitted and accepted for marketing of the new drug.
Some early innovative biopharmaceutical pipelines have disclosed excellent clinical data, and there is high potential for subsequent development. Currently, the company also has 8 products in phase 1 and 2 clinical stages. Among them, PD-1/TIGIT bispecific antibodies revealed excellent clinical data for cervical cancer at the ASCO 2024 meeting. If excellent data is maintained in other tumors, it is expected to become the next generation IO cornerstone drug; in addition, the triple-specific antibody (CD3×DLL3×DLL3) injectable ZG006 for injection against DLL3-expressing tumors has received high market attention. Early clinical trials of drugs, PD-1/TIGIT bispecific antibodies, LAG-3/TIGIT bispecific antibodies, VEGF/TGF-beta bifunctional antibody fusion proteins, Toll-like receptor 8 (TLR8) agonists, and pan-KRAS inhibitors are also progressing in an orderly manner, and the potential for subsequent product pipelines is high.
Investment advice: We expect the company's revenue from 2024 to 2026 to be 0.622 billion yuan, 1.223 billion yuan, and the net profit will be -0.168 billion yuan, 0.057 billion yuan, and 0.333 billion yuan respectively. Considering the volume potential of the company's marketed/upcoming products and rich clinical research and development pipeline, we believe that the company's future development prospects are promising. According to the DCF model, we will be given a six-month target The price is 67.82 yuan, maintaining a buy-A investment rating.
Risk warning: Risk of clinical trial progress falling short of expectations, risk of clinical trial failure, risk of product sales falling short of expectations.