NKF(603707) 民生证券·2025-03-19 12:30Investment Rating - The report initiates coverage with a "Buy" rating for the company [5]. Core Views - The company is transitioning towards high-end formulations, with a significant increase in the proportion of its formulation business, which accounted for over 70% of total revenue in 2023. This shift reflects a successful transformation from a traditional raw material supplier to an international sterile injection enterprise [1][17]. - The company has established a strong presence in the U.S. market, with over 50 products operational and a leading position in ANDA approvals among domestic peers. The U.S. subsidiary generated sales of 1.63 billion yuan in 2023, marking it as one of the largest Chinese pharmaceutical companies engaged in high-end formulation sales in the U.S. [2][19]. - The report forecasts revenue growth for the company, projecting revenues of 4.24 billion yuan, 5.57 billion yuan, and 7.19 billion yuan for 2024, 2025, and 2026, respectively, with corresponding net profits of 946 million yuan, 1.16 billion yuan, and 1.62 billion yuan [4][19]. Summary by Sections Company Overview - The company is one of the largest global suppliers of heparin raw materials and formulations, with over 80 formulation varieties marketed in more than 60 countries. It has been increasing R&D investments to support its transition to high-end formulations [1][10]. Formulation Business - The formulation business is the main source of revenue and profit for the company, with sales increasing from 762 million yuan in 2019 to 2.77 billion yuan in 2023, representing 70.50% of total revenue. The gross profit from this segment also rose significantly during the same period [22][23]. - The company has been actively expanding its domestic market presence through successful bids in national procurement, although sales have faced pressure due to price reductions [24][40]. Heparin Raw Materials - The heparin raw material business has shown a mild recovery, with stable production levels. However, the company faced a significant inventory impairment in 2023, leading to a net profit decrease of 1.05 billion yuan. A recovery in the global heparin market is expected in 2024, with potential reversals of inventory impairments [3][19]. Financial Forecast and Investment Recommendations - The report anticipates substantial growth in the company's overseas formulation business, which is expected to drive overall performance. The projected earnings per share (EPS) for 2024, 2025, and 2026 are 0.59 yuan, 0.72 yuan, and 1.00 yuan, respectively [4][19].