九洲药业(603456):持续扩宽大客户 深度发展打造核心平台

Jiuzhou Pharmaceutical (603456): Continuing to expand the in-depth development of large customers and build a core platform

廣發證券 ·  12/18/2022  · Researches

Core ideas:

Rely on Novartis deep cooperation to ensure the company's medium-and long-term development, constantly broaden large customers to bring more increment. The company goes deep into the Novartis supply chain and plays an important role in the supply chain of key products. The deep cooperation with Novartis not only continues to lay a solid foundation for the development of the company's CDMO business, but also is expected to provide more high-quality project orders for Jiuzhou as the cooperation deepens. On the other hand, the company has continued to expand its global major customers effectively, and has carried out further cooperation with Roche, Shuoteng, GSK, etc., the proportion of new customers and new pipelines has significantly increased, reducing the over-reliance on a single customer or a single product, and new projects and new orders are expected to support rapid revenue growth in the future.

The market of main API varieties is stable, and the profitability of the protection sector is improved with the improvement of technological transformation and capacity utilization. The company's basic disk of API is stable, and it is a major global manufacturer of characteristic APIs such as carbamazepine, ketoprofen, gliclazide and sulfasalazine. After the resumption of production in Jiangsu Ruike, the capacity utilization continues to improve, and the downstream bargaining power of the main products is strong. With the improvement of upstream raw material prices in the future, we are optimistic about the increase in gross profit margin and income of API and intermediate business brought about by the increase in capacity utilization.

New business and new areas expand rapidly, with abundant production capacity and integrated layout to ensure long-term performance development.

The company continues to expand its production capacity through acquisitions, including Suzhou Novartis and Hangzhou Taihua; the acquisition of Kangchuan Ji enables the company to provide one-stop service for API and preparations from CMC research and development to commercial production. In the aspect of new business, the company has rich reserves of preparation projects and polypeptide projects, and is optimistic about the long-term development of the company with the advantages of raw material drug supply and production.

Profit forecast and investment advice. Benefiting from the company's excellent production and manufacturing capacity and the continuous expansion of major customers to undertake more new orders, it is estimated that the company's return net profit in 22-24 is 944 million yuan, 1.285 billion yuan and 1.689 billion yuan respectively, EPS is 1.13,1.54 yuan and 2.02 yuan per share respectively, and the corresponding PE is 34.44,25.29,19.24 times respectively. With reference to the comparable company valuation, we think it is appropriate to give the company a reasonable valuation of 30 times PE in 23 years, with a "buy" rating corresponding to the reasonable value of A shares of 46.21 yuan per share.

Risk hint. Supply chain risk, exchange rate fluctuation risk, regulatory review risk and so on.

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