Incidents:
The company released its 2024 mid-year report. In the first half of 2024, the company achieved operating income of 0.238 billion yuan, a year-on-year increase of 28.59%; net profit to mother was 0.047 billion yuan, an increase of 52.91% year-on-year. Looking at Q2 alone, the company achieved revenue of 0.14 billion yuan in 2024, a year-on-year increase of 41.55%, and achieved net profit to mother of 0.03 billion yuan, an increase of 120.77% year-on-year. The company surpassed market expectations in Q2.
Key points of investment:
The merger of source leaves led to rapid growth in Q2. According to the company's 24-year report, the growth of various indicators such as the company's revenue and profit has benefited from the company's investment in R&D over the years, leading to the continuous expansion of product variety; implementing optimization measures on the sales side to enhance customer attention and satisfaction; at the same time, the holding subsidiary Yuanye Biotech was included in the scope of consolidation in the second quarter. Relevant operating data contributed to the growth of various financial indicators. Among them, Yuanye Biotech's related performance contributed 31.6816 million yuan to consolidated operating income, and net profit contributions attributable to the parent company 5.9448 million yuan. According to the company's previous acquisition announcement, Yuanye Biotech is mainly engaged in R&D, production and sales of scientific research reagents, and has obvious advantages in biochemical reagents, standard products, small molecule inhibitors, liquid reagents and other related products. The “Yuanye” reagent brand has business all over the country and has a certain popularity in the industry. Yuanye Biotech promises to deduct no less than 33 million/ 40 million/ 47 million yuan in 24-26 years. If it continues to be fulfilled, it will enhance the company's future performance.
The company continues to advance research and development, and the number of patents is constantly increasing. According to the company's 2024 interim report, in the first half of 2024, the company and its subsidiaries applied for a total of 24 new patents, including 3 invention patents, 2 utility model patents, 9 design patents, and 10 software copyrights in China; in the first half of 2024, they obtained 1 domestic invention patent, 1 utility model patent, and 10 software copyrights. In the first half of 2024, research reagent research and development projects were carried out normally and progressed steadily. In the first half of 2024, the company was awarded a group member by the Chinese Chemical Society and awarded the Innovation Contribution Award by the China Chemical Reagent Industry Association.
Profit forecasting and investment ratings. As one of the leading domestic pharmaceutical upstream companies, the company achieved rapid growth in the first half of the year through epitaxial acquisitions and endogenous growth. We maintained the 24-26 net profit forecast of 0.123, 0.149, and 0.181 billion yuan, corresponding to PE of 23, 19, and 15 times, respectively, and we maintained an “increase” rating.
Risk warning: New product development falls short of expectations, industry competition deteriorates, product price decline risk, domestic substitution process falls short of expectations.