What happened: the company released its quarterly report for 2021. The company's 21Q1 realized revenue of 224 million yuan, compared with the same period in 20 / 19, + 43.9% of the same period last year, and 36.9% of the same period of 20 / 19, and realized a net profit of 34 million yuan, compared with the same period of 19,19,19,134.1% and 92.6% of the same period of the same period last year.
Production and sales are booming to drive income growth, and the cost side is greatly improved. The company's 21Q1 achieved revenue of 224 million yuan, an increase of 43.9%, mainly due to the increase in co-extrusion sales of original products and new products; on the expense side, the company's expense rate decreased from 6.2pct to 11.2% compared with the same period last year, of which the sales expense rate / management expense rate / financial expense rate was 5.4%, 6.2%, 0.4%, respectively, compared with the same period last year-1.7pct/-2.2pct/-2.3pct. The financial expense rate fell year-on-year because of the decline in the euro exchange rate of loans. In addition, the company strengthens product research and development, expands application scenarios to match customer needs, and the rate of 21Q1 R & D expenses is 2.7%.
"purchase with volume" promotes the conversion of bulk orders to large quantities of orders, and "related examination and approval" increases customer stickiness. For the major contract order of 53 million yuan signed with Huahai, by the end of the 21Q1 reporting period, the cumulative recognized sales revenue was 19.24 million yuan, and the recognized sales revenue during the 21Q1 period was 7.43 million yuan. The cash received by the company from investment income increased significantly to 8.691 million yuan, mainly due to the receipt of profit distribution of 8.603 million yuan in 2020 from Jiucheng Packaging. In addition, since 2016, the State Drug Administration has issued relevant laws and regulations to continuously improve the requirements of "related examination and approval". There is a higher correlation between pharmaceutical companies and pharmaceutical packaging companies, and customer relations are more stable. According to Frost&Sullivan statistics, the market size of the domestic pharmaceutical packaging industry stood at 100 billion yuan in 2015, and the CAGR in 2019-2019 was about 10.50%. The overall growth rate of the industry is faster than the global level. Therefore, with the continuous growth of downstream pharmaceutical production enterprises, the company's sales show a good trend of steady growth.
Actively expand the field of business, tap the depth and breadth of products. The company announced in April 2021 that it intends to raise 602 million yuan for the "High Barrier Composite material Project". The main body of the project is Haishun, Zhejiang Province. The technical requirements of this project are high. By purchasing advanced equipment, the company will improve the level of intelligent production and speed up the change of drug packaging technology to establish a differentiated competitive advantage. At present, the company has 13 invention patents, successfully applied for the record of drug packaging materials issued by many national drug examination centers, and 11 DMF records issued by FDA in the United States, which is one of the most complete solid drug packaging companies in China.
Profit forecast and rating: as the leader of the medicine bag, the company expands the business scope, improves the industrial chain and enriches the product structure through vertical and horizontal mergers and acquisitions. The overall goal in the next five years is to continue to tap the depth and breadth of products, continue to consolidate the company's market position in the field of solid drug packaging, expand the field of liquid drug packaging, enrich and extend the company's product line, and expand the leading gap with competitors, form the company's leading advantage in the field of pharmaceutical packaging. We estimate that the company's net profit in 2023 will be about RMB 151,190 million for 2023, corresponding to a "buy" rating of PE of 18Compact 14max 12X respectively.
Risk tips: fund-raising projects do not meet expectations after production expansion, industry policy adjustment, and the impact of the macro epidemic.