2Q24 The company's revenue grew steadily, and the net profit growth rate was under pressure
The company's 1H24 operating income/net profit deducted from mother was 0.299/0.057/0.058 billion yuan, +11.6%/-38.1%/-36.0% year on year; 2Q24 operating income/net profit after deduction of non-return to mother was 0.153/0.026/0.027 billion yuan, +16.6%/-44.1%/-39.9% year over year. We believe that the profit growth rate is mainly due to the impact of a large year-on-year increase in the cost ratio, loss of foreign exchange options, and depreciation in inventory prices. We expect EPS of 1.16/1.40/1.70 yuan in 24-26 years. We gave the company a PE valuation of 47x in 24 years (comparable to the company's 24-year average expectation of 47x), corresponding to a target price of 54.30 yuan, maintaining a “buy” rating.
2Q24 sales, R&D and financial expense ratio increased year on year, gross margin decreased slightly year on year. The company's 1H24 sales/management/R&D/finance expense ratio 32.29%/16.06%/26.13%/-8.97%, +5.01/+1.08/+3.55/+4.42pct, 2Q24 sales/management/R&D/ finance expense ratio 32.16%/16.24%/26.98%/-8.13%, the company Investment in sales and R&D continued to increase, and the corresponding expense ratio increased year on year; the significant year-on-year increase in financial expense ratios was mainly due to high exchange earnings in the same period last year, which lowered the financial expense ratio base. The company's 1H24/2Q24 gross profit margin was 91.46%/90.39%, +0.36/ -0.76pct year-on-year.
2Q24 Regular revenue grew rapidly year over year, and growth accelerated month-on-month
1H24 regular and COVID-19 revenues were 0.285/0.015 billion yuan, respectively, +18.9%/-49.5% YoY. 2Q24's regular and COVID-19 revenue was 0.146/0.007 billion yuan, respectively, +21.7%/-37.8% YoY. 2Q24's regular business demand continued to recover, and regular revenue growth accelerated month-on-month.
Recombinant protein revenue grew steadily year on year, while antibody and reagent revenue maintained steady growth. 1H24's recombinant protein revenue was 0.254 billion yuan, up 11.4% year on year. Relying on a self-developed biotechnology platform, the company has developed high-quality, highly active recombinant proteins with various disease targets and biomarkers to meet the demand for recombinant proteins in different aspects of the biopharmaceutical development and production process, and revenue has increased steadily accordingly. Revenue from 1H24 antibodies, kits and other reagents was 0.034 billion yuan, up 17.2% year on year, maintaining steady growth.
Domestic biological reagent leaders that focus on serving the innovative drug industry chain and maintain the “buy” rating. We expect net profit of 0.14/0.17/0.2 billion yuan to the mother in 24-26, -10%/+21% year-on-year. The current stock price corresponds to the 24-26 PE valuation of 29x/24x/20x, and the target price is 54.30 yuan (previous value of 54.68 yuan), maintaining the “buy” rating.
Risk warning: products cannot meet market demand; market competition intensifies; overseas development falls short of expectations.