Aurisco(605116) 申万宏源·2024-09-23 10:08Investment Rating - The report initiates coverage on Aurobindo Pharma with a "Buy" rating, citing a 10 99% upside potential to the target market value of 9 1 billion RMB based on a PEG valuation of 0 75x [6][54] Core Views - Aurobindo Pharma has established six major technological innovation platforms, including biofermentation, complex synthesis, synthetic biology, photochemistry, crystal research, and oligonucleotide synthesis, which support its transition from small molecules to peptides and oligonucleotides [3] - The company's first formulation, Dydrogesterone, was approved in June 2023, marking a significant breakthrough in its "API + Formulation" integrated strategy [3] - Aurobindo Pharma has a diversified product portfolio covering six core therapeutic areas: cardiovascular, oncology, women's health, respiratory, nervous system, and anti-infectives, with strong performance in cardiovascular, oncology, and women's health segments [3] - The company is focusing on the "API + Formulation" integration strategy and is proactively laying out oligonucleotide business for long-term growth potential [4] Financial Projections - Revenue is expected to grow from 16 03 billion RMB in 2024 to 24 14 billion RMB in 2026, with a CAGR of 23 47% [4][6] - Net profit is projected to increase from 3 83 billion RMB in 2024 to 6 63 billion RMB in 2026, with a CAGR of 31 5% [4][6] - Gross margin is forecasted to improve from 58 8% in 2024 to 61 7% in 2026, driven by the formulation business [4][6] Business Segments - The API and intermediates segment accounted for 83 87% of total revenue in 2023, with cardiovascular, oncology, and women's health products showing strong growth [3][23] - The formulation segment, currently represented by Dydrogesterone, is expected to grow rapidly with the launch of Abiraterone Acetate, Enzalutamide, and Estradiol/Dydrogesterone combination tablets [4][7] - The trade and other businesses are relatively small, with combined revenues expected to grow from 1 26 billion RMB in 2024 to 1 55 billion RMB in 2026 [7] Strategic Initiatives - Aurobindo Pharma is expanding its production capacity with new facilities and projects, including a 300kg Semaglutide API production line and a 3 billion Estradiol/Dydrogesterone combination tablet production line [31][32] - The company is investing in oligonucleotide technology, with a dedicated platform and team to support the development of nucleic acid drugs [45][47] - Aurobindo Pharma has a robust R&D pipeline, including Semaglutide, Finerenone, and other innovative APIs and formulations, with significant progress in synthetic biology and process optimization [35][37]