Keqian Biology(SH:688526) KAIYUAN SECURITIES·2024-11-03 12:30Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Views - The company's performance is expected to recover in the post-cycle phase, driven by the gradual recovery of pig supply and relatively high pig prices. The company has adjusted its profit forecasts for 2024-2026, expecting net profits of 370 million, 466 million, and 541 million respectively, with corresponding EPS of 0.79, 1.00, and 1.16 yuan [2][3] - The company maintains high R&D investment, with continuous growth from new products. The R&D expenses for Q1-Q3 2024 were 61 million yuan, with several key products expected to launch between 2025 and 2026 [4] Financial Performance Summary - For Q1-Q3 2024, the company reported revenue of 666 million yuan (down 19.57% year-on-year) and a net profit of 261 million yuan (down 27.09% year-on-year). Q3 alone saw revenue of 265 million yuan (down 10.35% year-on-year) and a net profit of 108 million yuan (down 8.68% year-on-year) [2] - The gross profit margin for Q3 2024 was 65.17% (down 8.97 percentage points year-on-year), while the net profit margin was 40.67% (up 0.68 percentage points year-on-year) [2] - The company’s revenue and profit forecasts for 2024-2026 have been revised upwards, with expected revenues of 943 million, 1.139 billion, and 1.328 billion yuan respectively [5] Product and Market Insights - In Q3 2024, the revenue breakdown by product showed that pseudorabies vaccine accounted for 25%-30%, diarrhea vaccine 30%-35%, and circovirus vaccine around 13% [3] - The sales channel distribution in Q3 2024 indicated that direct sales accounted for over 60%, while distribution accounted for about 30% [3] - The company is expected to see improved gross margins in Q4 2024 as the pressure on product prices eases due to the recovery of pig supply [3] R&D and New Product Development - The company is focused on high R&D investment, with significant products in the pipeline, including the pig circovirus 2D subtype vaccine expected to launch in H2 2025, and the pig fever pseudorabies bivalent live vaccine expected to be available in early 2025 [4] - The monthly sales of the cat trivalent vaccine have stabilized at over 1 million yuan since its launch in April 2024, with expectations for continued growth in 2025 [4]