Company Research Company visit Leveraging global opportunities By our latest talking with Dr. Li, we were impressed by Lee s pharm s drug pipeline. The international background of key shareholders has supported the company to leverage opportunities worldwide. We think the company could keep strong growth with current pipeline and potential enlarged pipeline base. The counter is currently trading at 30x P/E FY14 and 23x P/E FY15 based on Bloomberg consensus. Solid China exposure with self-developed drugs and licensed-in drugs With 20 years effort of Dr. Li and his team, Lee s pharm has had a solid exposure in China s healthcare market. The company has already launched 4 self developed drugs and 9 licensed-in drugs. It had sales of HK$697m in 2013 with 44% from selfdeveloped drugs and 56% from licensed-in drugs. It has build up a sales team with 250 self-managed sales covering 26 major cities in China while it has collaborated with 600 third party distributors. Leveraging global opportunities Key shareholders have strong background in international pharmaceutical industry, which bring Lee s pharm opportunities to leverage its resources in both China market and overseas market. Dr. Li holds a PH.D. of pharmacology from the university of Illinois at Chicago and was a post doctoral fellow with Wamer- Lambert, a subsidiary of Pfizer. Sigma-Tau Pharmaceuticals, Lee s pharm s key strategic investor, is a leading orphan drug player. With the support of the key shareholders, Lee s pharm could actively source opportunities to licensed-in overseas drugs to Chinese market. Steady strong growth in 2013 and 1Q 2014 Lee s Pharm reported a 5-year CAGR of 40.9% for top line and 39.9% for bottom line from 2008 to 2013. Its revenue increased 30.4% YoY to HK$697m in 2013 and 38.9% YoY in 1Q 2014 to HK$206m driving up by investment in the direct sales force and strong growth of licensed-in product. Its net profit increased 32.2% YoY to HK$150m in 2013 and 30.3% YoY to HK$42m. Rich pipeline strengthen the future Lee s pharm is now focusing on the area of cardiovascular, dermatology, oncology, gynecology, and ophthalmology. It is expanding its clinical development team. Seasoning managers were brought in and system is upgraded to improve the capacity and capability. A computerized clinical trial managing system CTMS has been installed to strengthen operation effectiveness and efficiency. The company is currently undergoing 14 licensed-in products, which are in the different stage of registration in China. Hong Kong / Health Care 24 July 2014 Non rated Last price (23 Jul 14) HK$10.28 HSI 23971.87 Mkt cap (HK$mn/US$mn) 5,589/721 52 week range (HK$) 5.90-10.60 Avg trading volume daily (US$mn) 0.25 Free float (%) 42.56% Source: Bloomberg Performance HK$ 10.00 9.00 Jul-13 Price(LHS) Mar-14 Rel. to HSI(RHS) 170% 160% 150% 140% 130% 120% 110% 100% 90% Performance 1M 3M 12M Absolute (%) 10.8 17.2 73.4 Absolute (US$, %) 10.8 17.2 73.5 Relative to HSI (%) 5.7 10.7 64.0 Source: Bloomberg Company background Lee's Pharmaceutical Holdings Limited develops, manufactures and sells quality biopharmaceutical products that focus on combating cardiovascular diseases and viral sexually transmitted diseases. Source: Bloomberg Figure 1: Financial Summary Year to Dec 31 (HK$mn) 2009A 2010A 2011A 2012A 2013A Revenue 174 256 400 534 697 Operating Profit 53 70 92 134 180 Reported Profit 46 58 84 114 150 Underlying Profit 46 58 77 114 150 Underlying EPS (HKD) 0.11 0.12 0.16 0.22 0.28 DPS (HKD) 0.02 0.03 0.04 0.06 0.07 BVPS (HKD) 0.33 0.52 0.65 1.14 1.44 P/E (x) 96.59 83.02 63.52 45.93 37.33 Dividend Yield (%) 0.2 0.3 0.4 0.6 0.7 P/B (x) 30.95 19.90 15.77 8.98 7.15 Source: Guosen Securities(HK) Helena Qiu SFC CE No.: AOX910 +852 2899 8328 helena.qiu@guosen.com.hk See the last page of this report for important disclosures 1
公司报告公司参观 李氏大药厂 (950 HK) 积极引进海外产品 通过最近与李博士的交流, 我们看到李氏大药厂储备了丰富的在研产品和在引进产品 公司核心股东的国际化背景为公司利用全球的资源发展其中国业务提供了坚实的基础 我们认为公司未来的产品线有潜力支持公司保持强劲的增长 根据彭博资讯提供的市场平均预期, 公司目前股价代表 2014 年 30 倍市盈率 2015 年 23 倍市盈率 同时推广自主研发产品和引进产品加速公司发展通过李博士和他的团队的 20 年耕耘, 李氏大药厂在中国的医药打下了坚实的基础 公司目前已经推出了 4 个自主研发药品和 9 个从海外引进的药品 公司在 2013 年实现了销售收入港币 6.97 亿元, 其中 44% 是来自自主研发药品,56% 来自引进产品 公司拥有 250 人的终端销售队伍覆盖中国 26 个主要城市 同时, 公司也与 600 个第三方分销商进行合作 利用全球资源发展中国业务李氏大药厂的核心股东对国际医药市场有深刻的理解 他们的资源帮助公司将海外的药品引入中国市场 公司创始人李博士持有芝加哥伊利诺大学药物学博士学位, 并曾经在辉瑞旗下公司 Wamer-Lambert 从事博士后研究 公司另外的策略股东 Sigma-Tau 是一家总部在意大利的主要从事孤儿药开发的医药集团 李氏大药厂在他们的支持下积极在全球寻找机会将海外的药品引入中国市场 持续强劲增长李氏大药厂从 2008 年到 2013 年的 5 年平均销售收入增长为 40.9%, 净利润增长为 39.9% 公司 2013 年销售收入同比增长 30.4% 为港币 6.97 亿元, 2014 年 1 季度销售收入同比增长 38.9% 为港币 2.06 亿元 终端销售团队的加强和引进产品的高速增长是收入增长的主要推动力 2013 年净利润同比增长 32.2% 为港币 1.5 亿元,2014 年 1 季度同比增长 30.3% 为港币 0.42 亿元 丰富的在研产品和在引进产品是未来增长的推动力公司目前主要发展心血管 皮肤疾病 肿瘤 妇科疾病 眼科疾病等方面的药物 公司正积极扩大其临床研发团队, 并增聘有经验的临床管理人员 公司亦在升级相关系统, 提升团队产能及能力 另外, 公司也安装了一套电脑化临床管理系统 CTMS, 以增强营运效率及效益 香港 / 医疗保健 2014 年 7 月 24 日未评级 收盘价 (23 Jul 14) HK$10.28 恒生指数 23971.87 总市值 (HK$/US$mn) 5,589/721 52 周最高 / 最低 (HK$) 5.90-10.60 日均成交额 (US$mn) 0.25 流通量 (%) 42.56% 资料来源 : 彭博 股价表现 HK$ 10.00 9.00 Jul-13 股票数据 1M 3M 12M 绝对回报 (%) 10.8 17.2 73.4 绝对回报 (US$, %) 10.8 17.2 73.5 相对 HSI 回报 (%) 5.7 10.7 64.0 资料来源 : 彭博 公司簡介 李氏大药厂控股有限公司从事开发 制造和销售以抗血管疾病及病毒性性病为主的优质生物制药产品 资料来源 : 彭博 Price(LHS) Mar-14 Rel. to HSI(RHS) 170% 160% 150% 140% 130% 120% 110% 100% 90% Figure 2: 盈利预测 截至 Dec 31 ( 港元百万 ) 2009A 2010A 2011A 2012A 2013A 营业额 174 256 400 534 697 经营盈利 53 70 92 134 180 净利润 46 58 84 114 150 实际盈利 46 58 77 114 150 每股实际盈利 (HKD) 0.11 0.12 0.16 0.22 0.28 每股股息 (HKD) 0.02 0.03 0.04 0.06 0.07 每股账面价值 (HKD) 0.33 0.52 0.65 1.14 1.44 市盈率 (x) 96.59 83.02 63.52 45.93 37.33 股息率 (%) 0.2 0.3 0.4 0.6 0.7 市净率 (x) 30.95 19.90 15.77 8.98 7.15 资料来源 : 国信证券 ( 香港 ) 邱海燕证监会中央编号 :AOX910 +852 2899 8328 helena.qiu@guosen.com.hk 研究报告仅代表分析员个人观点, 请务必阅读正文之后的免责声明 2
Figure 3 Shareholder structure Name % of shares Lee Siu Fong & Leelalertsuphakun Wanee 22.35% Li Xiaoyi & his spouse 9.50% Sigma-Tau Industrie Farmaceutiche Riunite 25.59% GL trade investment 10.12% FIL limited 6.86% Others 25.58% Total 100.00% Source: Company data (2013 annual report), Guosen Securities(HK) Research Figure 4 Top management background Name Position Experience Ms. Lee Siu Fong Chairman Ms. Lee joined the Group in April 1997 and has since been responsible for the Group s financial affairs. Ms. Lee is an entrepreneur and had since 1992 established and run several companies with primary responsibility in financial affairs. Ms. Lee is the sister of Ms. Leelalertsuphakun Wanee and Dr. Li Xiaoyi. Ms. Leelalertsuphakun Wanee Li Xiaoyi Chief marketing & sales officer CEO & CTO Ms. Leelalertsuphakun joined the Group in April 1997. In September 2003, Ms. Leelalertsuphakun was appointed the Chief Marketing & Sales Officer and is responsible for the Group s sales and marketing activities. Ms. Leelalertsuphakun is the sister of Ms. Lee and Dr. Li Xiaoyi. Dr. Li holds a Ph.D. of Pharmacology from the University of Illinois at Chicago and was a postdoctoral fellow with Warner-Lambert, a subsidiary of Pfizer. He is the founder of the Group and has been responsible for the daily operation and R&D of the Group since 1994. Dr. Li is the brother of Ms. Lee and Ms. Leelalertsuphakun. Mr. Mauro Bove Non-executive director Mr. Bove joined the Group on 9 May 2005. He obtained his law degree at the University of Parma, Italy, in 1980 and has more than thirty years of business and management experience within the pharmaceutical industry. Mr. Bove has served in a number of senior positions in business, licensing, M&A and corporate development within Sigma-Tau, one of the leading Italian pharmaceutical groups. He presently heads the corporate and business development department at Sigma-Tau Finanziaria S.p.A. Source: Company data, Guosen Securities(HK) Research Guosen Securities (HK) 3
Figure 5 Drugs pipeline Drug Name Main Application Current status Licensed-in drugs Remodulin Oral Carnitene Trazodone (Trittico ) Hyalgan Betrixaban Gimatecan Rostafuroxin Istaroxime Anfibatide Kalbitor Self-developed drugs Treatment of pulmonary arterial hypertension (PAH) Application for Cardiac disease Treatment of depression Directly inhibitor of the activity of Factor Xa Treatment of ovarian cancer Anti-hypertension Treatment of heart failure Proprietary anti-platelet agent/treatment of coronary syndromes Treatment of hereditary angioedema (HAE) Received the import drug licenses from CFDA in April 2013 Received CFDA approval for marketing the drug in July 2013 completion of a registration-enabling conduction of a registration-enabling Application for a registrationenabling Application for a registrationenabling Application of phase IIb studies in China Application of phase IIb studies in China Conduction of phase II clinical in China Application of CFDA approval Zingo PPI drug Received US FDA approval ZK003 (Self-developed) Source: Company data, Guosen Securities(HK) Research Treatment of chemo-induced alopecia and in accelerating the healing of cornea ulcer Application of Clincial trial in China Figure 6 12M forward PE band chart HK$ 4.00 3.00 2.00 1.00 0.00 Feb-10 Oct-10 Jun-11 Feb-12 Oct-12 max 25.5X +1sd 20.7X PE(x) 18.9X avg 17.0X -1sd 13.4X min 12.3X Figure 7 12M forward PB band chart 10.00 9.00 max 6.2X +1sd 4.9X avg 3.8X PB(x) 3.6X 4.00-1sd 2.6X min 2.4X 3.00 2.00 1.00 0.00 Feb-10 Oct-10 Jun-11 Feb-12 Oct-12 Source: Bloomberg, Guosen Securities(HK) Research Source: Bloomberg, Guosen Securities(HK) Research Guosen Securities (HK) 4
Summary financial statements Profit & Loss (HK$mn) 2009A 2010A 2011A 2012A 2013A Financial Ratios 2009A 2010A 2011A 2012A 2013A Revenue 174 256 400 534 697 Revenue growth (%) 0.0 47.2 56.2 33.7 30.4 Cost of sales (49) (77) (108) (153) (194) Operating profit growth (%) 0.0 30.8 32.0 45.5 34.2 Gross profit 125 178 292 381 503 Reported profit growth (%) 0.0 25.1 44.6 35.6 32.2 Other income/(expense) 5 6 6 12 11 Underlying profit growth (%) 0.0 24.6 34.0 46.9 32.2 Operating expenses (76) (114) (205) (259) (334) Underlying EPS growth (%) 0.0 16.3 30.7 38.3 23.0 Operating profit 53 70 92 134 180 Dividend growth (%) 0.0 28.2 42.7 53.1 33.6 Other non operating inc/(exp) 3 5 13 7 7 Gross profit margin (%) 71.7 69.8 73.0 71.3 72.2 Finance income 0 0 0 2 3 Operating profit margin (%) 30.8 27.3 23.1 25.1 25.9 Finance expenses (4) (6) (8) (10) (12) Underlying profit margin (%) 26.7 22.6 19.4 21.3 21.6 Associates & JCE 0 (1) 0 0 (2) Net debt/equity (%) (30.3) (42.3) (37.6) (51.9) (39.4) Profit before taxation 53 68 98 133 176 Net debt/total assets (%) (21.0) (32.7) (28.6) (38.0) (26.6) Taxation (6) (10) (14) (20) (27) Current ratio (%) 234 338 306 296 236 Non-controlling interests 0 0 0 1 1 Dividend payout (%) 23.3 23.9 25.5 26.5 26.8 Net profit 46 58 84 114 150 Interest cover (x) 12.7 12.3 11.8 12.9 15.7 Other Adjustments on UP 0 0 (6) 0 0 Dividend cover (x) 4.3 4.2 3.9 3.8 3.7 Underlying Profit 46 58 77 114 150 Dupont Analysis 2009A 2010A 2011A 2012A 2013A Source: Guosen Research estimates Tax burden (%) 87.8 85.4 85.8 85.5 85.4 Interest burden (%) 98.7 97.2 106 99.1 97.6 Operating profit margin (%) 30.8 27.3 23.1 25.1 25.9 Asset turnover (x) 1.0 1.1 0.9 0.7 Leverage ratio (x) 1.3 1.3 1.3 1.4 ROA (%) 22.3 23.2 18.9 15.3 ROE (%) 30.1 30.3 25.5 22.0 Source: Guosen Research estimates Balance Sheet (HK$mn) 2009A 2010A 2011A 2012A 2013A Cashflow (HK$mn) 2009A 2010A 2011A 2012A 2013A Fixed assets 25 27 47 129 263 Operating profit 53 69 98 134 178 Associates & JCE 0 9 8 10 35 Depreciation & amortization 5 8 11 15 17 Others 64 70 99 146 226 Interest income 0 0 0 (2) (3) Non-current assets 90 105 154 285 524 Change in working capital (2) (7) (20) 25 (13) Inventories 27 23 35 64 118 Tax paid (3) (4) (3) (17) (26) Debtors & prepayments 30 61 84 105 122 Other operating cashflow 1 2 1 19 27 Bank deposits & cash 60 120 134 334 379 Operating activities 54 68 88 174 179 Others 2 2 2 9 23 Purchase of non-current assets (Capex) (42) (36) (63) (146) (222) Current assets 119 206 256 512 642 Free cash flow 12 32 25 28 (43) Bank & other borrowings 8 18 17 31 69 Disposal of non-current assets 0 0 0 0 0 Trade & payables 2 2 56 29 36 Associates & JCE (net) 0 (4) 0 0 0 Taxation 1 3 10 13 13 Interest received 0 0 0 2 3 Others 40 38 1 99 153 Dividends received 0 0 0 0 0 Current liabilities 51 61 83 173 272 Other investing cashflow 0 0 0 21 73 Bank & other borrowings 8 0 0 0 0 Investing activities (42) (39) (62) (123) (146) Others 5 9 14 31 41 New loans raised 22 9 12 22 50 Non-current liabilities 13 9 14 31 41 Repayment of loans (9) (9) (13) (7) (12) Net assets 145 241 312 593 852 Dividends paid (8) (12) (15) (23) (33) Share capital 23 23 23 26 27 Other financing cashflow 21 40 3 157 4 Premium & reserves 122 218 288 556 759 Financing activities 26 29 (13) 147 9 Shareholders' funds 145 241 312 582 786 Inc/(dec) in cash 38 59 13 198 42 Non-controlling interests 0 0 0 11 66 Cash at beginning of year 22 60 120 134 334 Total equity 145 241 312 593 852 Foreign exchange effect 0 1 2 1 3 Source: Guosen Research estimates Cash at end of year 60 120 134 334 379 Source: Guosen Research estimates Guosen Securities (HK) 5
Information Disclosures Stock ratings, sector ratings and related definitions Stock Ratings: Buy: A return potential of 10 % or more relative to overall market within 6 12 months. Neutral: A return potential ranging from -10% to 10% relative to overall market within 6 12 months. Sell: A negative return of 10% or more relative to overall market within 6 12 months. Sector Ratings: Overweight: The sector will outperform the overall market by 10% or higher within 6 12 months. Neutral: The sector performance will range from -10% to 10% relative to overall market within 6 12 months. Underweight: The sector will underperform the overall market by 10% or lower within 6 12 months. Interest disclosure statement The analyst is licensed by the Hong Kong Securities and Futures Commission. Neither the analyst nor his/her associates serves as an officer of the listed companies covered in this report and has no financial interests in the companies. Guosen Securities (HK) Brokerage Co., Ltd. and its associated companies (collectively Guosen Securities (HK) ) has no disclosable financial interests (including securities holding) or make a market in the securities in respect of the listed companies. Guosen Securities (HK) has no investment banking relationship within the past 12 months, to the listed companies. Guosen Securities (HK) has no individual employed by the listed companies. Disclaimers The prices of securities may fluctuate up or down. It may become valueless. It is as likely that losses will be incurred rather than profit made as a result of buying and selling securities. The content of this report does not represent a recommendation of Guosen Securities (HK) and does not constitute any buying/selling or dealing agreement in relation to the securities mentioned. Guosen Securities (HK) may be seeking or will seek investment banking or other business (such as placing agent, lead manager, sponsor, underwriter or proprietary trading in such securities) with the listed companies. Individuals of Guosen Securities (HK) may have personal investment interests in the listed companies. This report is based on information available to the public that we consider reliable, however, the authenticity, accuracy or completeness of such information is not guaranteed by Guosen Securities (HK). This report does not take into account the particular investment objectives, financial situation or needs of individual clients and does not constitute a personal investment recommendation to anyone. Clients are wholly responsible for any investment decision based on this report. Clients are advised to consider whether any advice or recommendation contained in this report is suitable for their particular circumstances. This report is not intended to be an offer to buy or sell or a solicitation of an offer to buy or sell the securities mentioned. This report is for distribution only to clients of Guosen Securities (HK). Without Guosen Securities (HK) s written authorization, any form of quotation, reproduction or transmission to third parties is prohibited, or may be subject to legal action. Such information and opinions contained therein are subject to change and may be amended without any notification. This report is not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation or which would subject Guosen Securities (HK) and its group companies to any registration or licensing requirement within such jurisdiction. Guosen Securities (HK) 6
信息披露 公司评级 行业评级及相关定义 公司评级买入 : 我们预计未来 6-12 个月内, 个股相对大盘涨幅在 10% 以上 ; 中性 : 我们预计未来 6-12 个月内, 个股相对大盘涨幅介于 -10% 与 10% 之间 ; 减持 : 我们预计未来 6-12 个月内, 个股相对大盘跌幅大于 10% 行业评级超配 : 我们预计未来 6-12 个月内, 行业整体回报高于市场整体水平 10% 以上 ; 中性 : 我们预计未来 6-12 个月内, 行业整体回报介于市场整体水平 -10% 与 10% 之间 ; 低配 : 我们预计未来 6-12 个月内, 行业整体回报低于市场整体水平 10% 以上 利益披露声明 报告作者为香港证监会持牌人士, 分析员本人或其有联系者并未担任本研究报告所评论的上市法团高级管理人员, 也未持有其任何财务权益 本报告中, 国信证券 ( 香港 ) 经纪有限公司及其所属关联机构 ( 合称国信证券 ( 香港 )) 并无持有该公司须作出披露的财务权益 ( 包括持股 ), 在过去 12 个月内与该公司并无投资银行关系, 亦无进行该公司有关股份的庄家活动 本公司员工均非该上市公司的雇员 免责条款 证券价格有时可能非常波动 证券价格可升可跌, 甚至变成毫无价值 买卖证券未必一定能够赚取利润, 反而可能会招致损失 本研究报告内容既不代表国信证券 ( 香港 ) 的推荐意见, 也并不构成所涉及的个别股票的买卖或交易要约 国信证券 ( 香港 ) 或其集团公司有可能会与本报告涉及的公司洽谈投资银行业务或其它业务 ( 例如配售代理 牵头经办人 保荐人 包销商或从事自营投资于该股票 ) 国信证券 ( 香港 ) 不排除其员工有个人投资于本报告内所提及的上市法团 报告中的资料均来自公开信息, 我们力求准确可靠, 但对这些信息的正确性 公正性及完整性不做任何保证 本报告没有考虑到个别客户特殊的投资目标 财务状况或需要, 并不构成个人投资建议, 客户据此投资, 责任自负 客户在阅读本研究报告时应考虑报告中的任何意见或建议是否符合其个人特定状况 本报告并不存在招揽或邀约购买或出售任何证券的企图 本报告仅向特定客户传送, 未经国信证券香港书面授权许可, 任何人不得引用 转载以及向第三方传播, 否则可能将承担法律责任 研究报告所载的资料及意见, 如有任何更改, 本司将不作另行通知 在一些管辖区域内, 针对或意图向该等区域内的市民 居民 个人或实体发布 公布 供其使用或提供获取渠道的行为会违反该区域内所适用的法律或规例或令国信证券 ( 香港 ) 受制于任何注册或领牌规定, 则本研究报告不适用于该等管辖区域内的市民 居民或身处该范围内的任何人或实体 Guosen Securities (HK) 7