HVSEN BIOTECH(300871) 申万宏源证券·2025-03-26 06:48Investment Rating - The report initiates coverage with a "Buy" rating for the company, indicating a positive outlook for its performance in the coming years [6][8]. Core Views - The company is positioned as a leading player in the domestic veterinary drug formulation market, with a focus on integrated expansion and a potential performance inflection point approaching [7][19]. - The recovery in demand for veterinary drugs, alongside the launch of new products, is expected to drive growth in the formulation business, while the upstream raw material business is entering a harvest phase [7][10]. - The report highlights the company's strategic focus on expanding into the pet medicine market, which is seen as a new growth area [7][10]. Financial Data and Profit Forecast - The company is projected to achieve total revenue of 1,020 million yuan in 2023, with a year-on-year growth rate of -0.3%. Revenue is expected to increase to 1,233 million yuan in 2024, representing a growth rate of 20.9%, and further to 1,677 million yuan in 2025, with a growth rate of 36.0% [2]. - The net profit attributable to shareholders is forecasted to be 17 million yuan in 2023, declining to -18 million yuan in 2024, but recovering to 149 million yuan in 2025 and 192 million yuan in 2026 [2]. - The earnings per share (EPS) is expected to be 0.10 yuan in 2023, -0.11 yuan in 2024, and then rise to 0.90 yuan in 2025 and 1.16 yuan in 2026 [2]. Company Overview - The company has obtained 175 veterinary drug approval numbers as of the first half of 2024, with products widely used in swine, poultry, aquaculture, ruminants, and pets [19]. - The company has a strong focus on research and development, with significant investments in expanding production capacity for both veterinary formulations and raw materials [19][24]. Industry Insights - The veterinary drug industry is experiencing a shift towards higher-end products driven by the scale of livestock farming and the need for effective disease prevention [10][50]. - The report notes that the veterinary drug market in China reached a scale of 696.51 billion yuan in 2023, with a significant portion attributed to chemical drugs [38]. - The raw material drug sector is expected to see a recovery in pricing as supply and demand dynamics improve, following a period of oversupply and weak demand [55][59].