2021-10-19 Tianfeng Securities Co., Ltd. Yang Song and Zhang Xue studied Kindick and released the research report "Rapid growth of tetravalent Influenza Vaccine". This report gives a buy rating to Kindick, and the current share price is 92.68 yuan.

Kindick (688670)
The company's 2021Q1~Q3 realized operating income of 349 million yuan, an increase of 32.97% over the same period last year, and its net profit was 100 million yuan, an increase of 106.69% over the same period last year, deducting 95 million yuan of non-return net profit, an increase of 72.72% over the same period last year. 2021Q3 realized operating income of 317 million yuan in a single quarter, an increase of 81.06% over the same period last year, and its net profit was 123 million yuan, an increase of 123.40% over the same period last year, deducting 120 million yuan of non-return net profit.
Rapid release of tetravalent influenza vaccine
2021Q3's single-quarter operating income was 317 million yuan, an increase of 81.06% over the same period last year, mainly due to the accelerated release of influenza vaccine. According to the data disclosed by the Central people's Procuratorate, as of September 27, 2021, the company has issued 42 batches of tetravalent influenza vaccines for the 2021-2022 flu season. The net profit of 2021Q3 in a single quarter was 123 million yuan, an increase of 123.40% over the same period last year. The profit growth rate was higher than the revenue growth rate, mainly because the gross profit margin increased and the sales expense rate decreased with the enhancement of the company's brand and scale effect. At present, the company has an annual production capacity of 10 million doses of tetravalent influenza vaccine, speeding up the construction of 30 million doses of annual production projects, and future growth is expected.
Influenza vaccination is encouraged in the country and around the country, which will help to improve the influenza vaccination rate.
Annual influenza vaccination is an effective way to prevent influenza and can significantly reduce the risk of influenza and serious complications. There is still a risk that COVID-19 will be superimposed with influenza and other respiratory infectious diseases this winter and next spring, and influenza vaccination is encouraged. On October 18, 2021, the Comprehensive Group of Joint Prevention and Control Mechanism of the State Council issued the Circular on doing a good job in Influenza Prevention and Control in the 2021-2022 epidemic season, proposing that all localities should, in accordance with the Technical Guide for Influenza vaccination in China, give priority to medical personnel, large-scale event participants and security personnel, vulnerable people and employees in crowd gathering places such as pension institutions, long-term care institutions, welfare homes, etc. Vaccination was carried out among people in key places such as kindergartens, primary and secondary schools, as well as elderly people aged 60 and above, children aged 6 months to 5 years, patients with chronic diseases and other key and high-risk groups. Encourage places where conditions are available to vaccinate the above-mentioned population free of charge, increase the vaccination rate and reduce the occurrence of influenza cluster epidemics.
Equity incentive enhances employee cohesion and promotes the long-term development of the company
On September 16, 2021, the company's board of directors adopted the "Resolution on the first Grant of restricted stocks to incentive targets", which determined 2021.9.16 as the first grant date, and awarded 652000 restricted shares to 369 incentive objects for the first time at 55.18 yuan per share. The first award of incentives accounts for about 93.42% of the total number of employees at the time of the announcement of the draft incentive plan, which helps to enhance employee cohesion and promote long-term development.
Profit Forecast and Investment rating
We believe that at present, the vaccination rate of influenza vaccine in China is on the low side, the dual pressure of COVID-19 and influenza prevention and control is paid more attention, and influenza vaccine needs to be vaccinated every year, and the proportion of superimposed tetravalent is increased with the increase of the overall vaccination rate. as an important manufacturer of tetravalent influenza vaccine, the company is also expected to benefit. We estimate that the company's operating income from 2021 to 2023 is 10.01 shock 12.52 / 2.556 billion yuan, a year-on-year increase of 69.9%, 25.1% and 104.1%. Excluding incentive fees, the estimated net profit of return to the home is 3.06 shock 3.78 / 788 million yuan, an increase of 97.5%, 23.5% and 108.3% over the same period last year, maintaining the "Buy" rating.
Risk hint: the coverage rate of influenza vaccine in China is lower than expected, and the risk of fierce competition in the vaccine industry