Event: the company disclosed its results in the first half of 22 years. The company's 22H1 income was 15.61 billion yuan (YOY+12.9%), its parent net profit was 2.97 billion yuan (YOY-3.1%), and its profit per share was 24.9 cents (YOY-2.8%), of which the adjusted basic profit attributable to shareholders was 3.07 billion yuan (YOY+14.9%), which met market expectations and paid a dividend of HK10 cents per share. Gross margin fell 3.5pp to 72.6 per cent year-on-year. In addition, driven by the core varieties of the six major disease areas, the revenue of proprietary medicine business increased by 9.4% compared with the same period last year, the revenue of API business increased by 22.7%, and that of functional food and other businesses increased by 43.5%.
Comments:
The business of proprietary medicine has grown steadily. 1) the product line of proprietary medicine is stable, with 22H1 revenue reaching 12.29 billion yuan (YOY+9.4%). Among them, the income from neurological drugs is 3.87 billion yuan (YOY+7.3%). Enpip actively develops the online self-expense market and relies on the previous market basis to achieve rapid sales growth. Mingfule has submitted an application for registration for ischemic stroke. 2) the revenue of anti-tumor product 22H1 reaches 4.06 billion yuan (YOY+2.3%). Among them, Ke Aili and Jinyou Li achieve quantity increase and price decrease in collection and mining. 3) in other sectors, the income of cardiovascular products is 1.52 billion yuan (YOY+4.8%); the income of anti-infection, respiratory system, digestion and metabolism and other areas is 17.5 million yuan, respectively, with a year-on-year growth rate of 23.9%, 33.1%, 46.0% and 33.9%, respectively.
Research and development blossomed, and COVID-19 vaccine progressed smoothly. The company's R & D efforts continue to increase, 22H1 R & D expenditure reached 1.88 billion yuan (YOY+16.8%), accounting for 15.3% of proprietary medicine revenue, in the industry-leading level and is expected to continue to increase. In terms of innovative R & D platforms, nano-preparations, mRNA vaccine platforms, ADC, monoclonal antibodies, double antibodies and PROTAC have their own characteristics, which is expected to promote more than a number of innovative drugs to be put on the market one after another. COVID-19 mRNA vaccine phase I clinical safety is good; also completed the clinical study of sequential enhanced immunization, safety and immunogenicity are up to the expected; the company has completed 500 million dose / year production capacity, the second phase of the new production line construction, after completion can reach 1.5 billion dose / year production capacity. Over the past 22 years, the company's PI3K inhibitors, mitoxantrone liposome injection and other varieties have been approved to market. In terms of external cooperation, the company has granted Claudin18.2 ADC rights outside the Greater China region, and is expected to continue to reach cooperation in the field of Becton Dickinson & Co to achieve multi-point blossom in research and development.
Profit forecast and investment rating. The company is a leading domestic pharmaceutical company with plenty of cash. We maintain the prediction of EPS for 22 ~ 24 years as 0.53, 0.59, and 0.65 yuan, respectively, and the corresponding PE is 13, 11 and 10x, respectively. Considering that the company's heavily stocked varieties are expected to be listed in an orderly manner, the current valuation is attractive and the "buy" rating is maintained.
Risk tips: API prices fluctuate, product sales fall short of expectations, and R & D falls short of expectations.