20211025-招银国际-泰格医药-300347.SZ-Impressive_backlog_growth_momentum_and_enhancing_global_competence_4页_1018kb

Tigermed (300347 CH) Company Update Summary

Core Content Overview

Tigermed, a company in the China healthcare sector, reported strong financial performance in the third quarter of 2021 and the first nine months of the year, driven by robust demand in the global clinical trial services market, particularly in the context of the ongoing pandemic. The company demonstrated impressive growth in revenue and net profit, with a notable increase in new orders, which indicates strong future revenue potential.

Key Financial Highlights

• Revenue:

  • 3Q21: RMB1,339 million (up 58% YoY)
  • 9M21: RMB3,395 million (up 78% of full-year estimate)
  • FY21E: RMB4,704 million (up 47.34% YoY)
  • FY22E: RMB6,367 million
  • FY23E: RMB8,495 million

• Net Profit:

  • 3Q21: RMB526 million (up 65% YoY)
  • 9M21: RMB1,781 million
  • FY21E: RMB2,258 million
  • FY22E: RMB2,439 million
  • FY23E: RMB3,180 million

• EPS (Earnings Per Share):

  • 3Q21: RMB2.59
  • FY21E: RMB2.59
  • FY22E: RMB2.80
  • FY23E: RMB3.64

• Profitability Metrics:

  • Gross margin: 46.8% (down from 48.5% in 9M20)
  • Net margin: 48.01% (FY21E)
  • ROE: 14.71% (FY21E)
  • ROA: 13.53% (FY21E)

Key Business Developments

• Backlog Growth:

  • New orders in 9M21 grew over 100% YoY, with 151% growth in 1H21.
  • Management expects full-year 2021 new orders to grow by 40-50% YoY, supporting near-term revenue growth.

• COVID-19 Related Revenue:

  • Tigermed booked RMB200 million in 3Q21, representing 15% of quarterly revenue.
  • Expected to book an additional RMB200 million in 4Q21E, indicating sustained demand from vaccine-related clinical trials.

• Global Expansion:

  • Tigermed has expanded its clinical services to over 20 new countries.
  • Assisted Chinese vaccine developers in conducting global trials in Brazil, Chile, and South Africa.
  • Management anticipates further growth through M&As to strengthen its global presence.
  • Enhanced ability to serve foreign clients conducting clinical trials in China.

Valuation and Investment Outlook

• Target Price (TP): RMB212.59 (up from previous TP of RMB198.40)
• Current Price: RMB164.02
• Price Target Upside: +29.61%
• DCF Valuation: RMB185,477 million (based on WACC of 9.84% and terminal growth of 3.0%)
• CMBIS Ratings:
  • BUY: Stock with potential return of over 15% over next 12 months
  • Maintain BUY: Revisions to FY21E/22E/23E attributable net profit forecasts by 7%/18%/21% respectively.

Shareholding and Market Performance

• Shareholding Structure:

  • Management: 37.11%
  • Temasek: 2.92%
  • Free float: 59.97%

• Stock Data:

  • Market Cap: RMB138,128 million
  • 3-month average turnover: RMB1,146.21 million
  • 52-week high/low: RMB209.41/RMB110.81

• Share Performance (12-month):

  • Absolute: 5.3%
  • Relative: 9.0%

Key Ratios

• Gross Margin:

  • 9M21: 46.8%
  • FY21E: 46.33%
  • FY22E: 45.47%
  • FY23E: 44.50%

• Operating Margin:

  • FY21E: 27.06%
  • FY22E: 26.50%
  • FY23E: 26.03%

• Net Margin:

  • FY21E: 48.01%
  • FY22E: 38.31%
  • FY23E: 37.43%

• ROE:

  • FY21E: 14.71%
  • FY22E: 12.96%
  • FY23E: 13.53%

Conclusion

Tigermed's performance in 3Q21 and 9M21 reflects strong growth in both revenue and net profit, fueled by the demand for clinical trial services related to the pandemic and a robust backlog. The company is enhancing its global competence, expanding its services to more than 20 new countries and positioning itself to serve international clients in China. The updated financial forecasts and higher target price reflect the company's promising growth outlook. With a BUY rating and strong fundamentals, Tigermed is seen as a favorable investment opportunity in the healthcare sector.