01/21/2022

Livzon Group (000513): Preview of 2019 Annual Results: Profit Exceeds Expectations

Livzon Group (000513): Preview of 2019 Annual Results: Profit Exceeds Expectations

Predicted net profit growth of 15-25% per yearThe company announced that net profit attributable to mothers in 2019 will increase by 15-25% per year to 12.

46-13.

5.3 billion, exceeding our expectations.

Attention points for non-net profit continued to accelerate in the fourth quarter.

In the first three quarters of 2019, the company’s non-net profit increased by 20.

33%, non-net profit deducted in the third quarter alone increased by 33 in ten years.

1%.

The company expects that the net profit after deduction for the first four quarters of 2019 will increase by 20% -30% to 11.

37-12.

3.1 billion yuan.

We expect the proportion of digestive and reproductive line income to increase further in 2019.

The company continuously deepens the reform of the marketing system and implements refined management.

In the first three quarters of 19, the senator’s quantum righting income accounted for 9 of the total income.

2% (revenue is downgraded by 18 quarterly.

5%); rat nerve income accounts for 4% of total income.

2% (14 quarterly revenue downgrade.

6%), we believe that products of this size will further reduce the company’s revenue contribution in the future.

In addition, we expect the revenue of leuprolide to reach RMB 9-10 trillion in 19 years, and the income of ilaprazole series is expected to reach RMB 10 trillion.

The active pharmaceutical business segment continued its strength.

The company’s high-end specialty drug substance business has grown rapidly, and its core varieties have an excellent competitive landscape.

The cost reduction brought about by the process improvement has further promoted the substantial increase in the profitability of the API business segment.

In 2018, the raw material drug sector accounted for about 20% of the company’s profit. The company’s raw material drug sector gross margin was about 30% in the first three quarters of 2019, which can increase up to about 6-7 alternatives.

We estimate that the profit contribution of the API segment will further increase in FY19.

Estimates and recommendations Based on the company’s performance preview, we raised our EPS forecast for 2019/2020/2021 by 4% / 8% / 11% to 1.

39 yuan / 1.

66 yuan / 1.

96 yuan, a year increase of 20% / 20% / 18%.

The current A share corresponds to 21 in 2020/2021.

0x / 17.

8 times P / E.

Considering that the company’s R & D is re-launched, our A shares maintain an outperform industry rating and target price of 41 yuan (corresponding to 24.

7/20.

9 times 2020/2021 P / E, 17.

51% upside).

The current H share corresponds to 15 in 2020/2021.

0 times / 12.

8 times P / E.

H shares maintain outperform industry rating and target price replacement of 30 (corresponding to 16.
4/13.

8 times 2020/2021 P / E, 9.

30% upside).

The progress of risk research and development was less than expected, 南京桑拿网 and the implementation of the partner’s shareholding plan was less than expected.