SNSW(688117) Huafu Securities·2024-04-24 12:30Investment Rating - The report assigns a "Buy" rating for the company, with a target price of 35.7 CNY based on a projected market capitalization of 4 billion CNY for 2024 [2][53]. Core Viewpoints - The GLP-1 market is driving the expansion of the peptide market, leading to increased demand for peptide APIs and CDMO services. The global peptide CDMO market is expected to grow from 2 billion USD in 2020 to 7.9 billion USD by 2030, with a CAGR of 14.7% [1]. - The company is a leading domestic player in peptide APIs, with ongoing capacity expansion and a diverse product portfolio. As of H1 2023, the company has 16 self-developed peptide API varieties, with 11 approved for the domestic market and 9 registered with the US DMF [1][13]. - The company possesses core technologies in peptide synthesis and modification, with a strong project experience and R&D capabilities. It has provided over 40 pharmaceutical research services, with several projects entering commercialization [1][34]. - The formulation business is leveraging its API production advantages to extend downstream, with multiple products entering national procurement, which is expected to enhance revenue through price-volume trade-offs [1][45]. Summary by Sections 1. Peptide APIs, CDMO, and Formulation Business - The company focuses on the peptide sector, with a collaborative development across APIs, CDMO, and formulations. It has exported multiple API products to international markets and has developed 9 peptide formulations with 13 production approvals in China [13]. - The new capacity for peptide APIs is expected to accelerate performance, with a current capacity of 400 kg/year and additional projects set to come online by December 2023 and August 2025 [33]. - The CDMO business is experiencing steady growth, with a revenue of 80 million CNY in 2022, primarily from pharmaceutical research services [34]. - The formulation business faced challenges in 2021-2022 but is expected to recover as several products have been awarded national procurement contracts [38][45]. 2. Earnings Forecast and Investment Recommendations - The company is projected to achieve revenues of 430 million CNY, 550 million CNY, and 710 million CNY for 2023, 2024, and 2025, respectively, with year-on-year growth rates of 10%, 26%, and 30% [53]. - The net profit forecast for the same period is 70 million CNY, 100 million CNY, and 140 million CNY, with growth rates of 8%, 44%, and 39% [53]. - The report utilizes a comparable company valuation method, estimating an average PE ratio of 30 for 2024, and assigns a target PE of 40 for the company, reflecting its growth potential [53].