Aurisco(605116) 民生证券·2024-07-25 08:22Investment Rating - The investment rating for the company is "Neutral" [23] Core Insights - The company primarily focuses on the production of active pharmaceutical ingredients (APIs) and intermediates, with a significant breakthrough in its "API + Formulation" integrated strategy in 2023, achieving sales revenue of 89.85 million yuan from its first formulation product [2][5] - The upstream raw material supply is abundant, and the company possesses strong bargaining power due to the mature state of the basic and fine chemical industries in China [3] - The integration of the "API + Formulation" industry chain is becoming a new trend, driven by government policies and the need for cost control, allowing API manufacturers to extend downstream and capture profit margins [5] Company Performance - In Q1 2024, the company achieved revenue of 336 million yuan, a year-on-year increase of 11.08%, with a gross profit margin of 53.68% [11][46] - The net profit attributable to shareholders for Q1 2024 was 82 million yuan, reflecting a year-on-year increase of 79.14% [92] - The company's cash flow from operating activities showed a net increase of 11.98% year-on-year, indicating good cash recovery capability [9] Market Position and Competitive Advantage - The company has established a diverse product chain covering six major therapeutic areas, creating high technical barriers and a favorable competitive landscape [13][70] - The company has a strong international presence, with 95.59% of its revenue coming from overseas markets, particularly from the EU, India, Brazil, the UK, and Argentina [40] - The market for chemical APIs is expected to grow, driven by increasing demand for drug formulations and the expiration of patents for many branded drugs, which will lead to a surge in generic drug production [42][88] Financial Metrics - As of July 23, 2024, the company's PE (TTM) ratio is 31 times, which is considered moderate compared to its peers [15][58] - The company’s revenue from the chemical pharmaceutical formulation industry has shown a compound annual growth rate of 4.57% from 2013 to 2022, indicating a growing market [42] Fundraising and Investment Projects - The company plans to raise 812 million yuan through the issuance of convertible bonds, with the funds allocated to projects aimed at expanding its formulation business and enhancing its API production capabilities [16][101] - The expected internal rate of return for the new projects is promising, with some projects projected to have an internal rate of return exceeding 29% [102]