[Click e Stock] "Samsung Biologics, Continued Strong Earnings Growth"

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[Asia Economy Reporter Song Hwajeong] Daishin Securities on the 30th forecasted that Samsung Biologics will continue its strong performance growth and issued a 'Buy' investment rating with a target price of 1.1 million KRW.

It is analyzed that attention should be paid to the operation of the 4th plant in the second half of next year and the diversification of contract manufacturing organization (CMO) and contract development and manufacturing organization (CDMO) businesses. Yunjin Lim, a researcher at Daishin Securities, said, "Samsung Biologics' investment points are stable external growth based on the world's largest production capacity, expansion of next-generation biopharmaceutical CDMO business through end-to-end one-stop services, productivity improvement based on self-developed cell lines, and profitability improvement due to increased plant utilization and operational efficiency."

In the first half of next year, the expansion of messenger ribonucleic acid (mRNA) production facilities is scheduled to be completed. Researcher Lim explained, "Following the contract for finished product (DP) production of the Moderna vaccine, a contract for drug substance (DS) production with Greenlight was signed, confirming the possibility of one-stop production of mRNA drugs," adding, "Significant expansion of the mRNA business is expected."

Through the expansion of the 2nd campus, entry into CDMO and CMO businesses such as cell and gene therapy (CGT) and vaccines is expected to accelerate. Based on the 'S-Cellerate' platform, which shortens the time from cell line development to approval, a short-term contract development organization (CDO) order track record has been secured.

Daishin Securities projected Samsung Biologics' consolidated sales for next year at 1.8379 trillion KRW and operating profit at 661.1 billion KRW, representing increases of 17.9% and 18.4% respectively compared to the previous year. Researcher Lim said, "Although regular maintenance of the 2nd plant is scheduled next year, strong performance growth will continue due to full operation of the 1st and 3rd plants and an increase in average selling price (ASP)."

The 4th plant is expected to partially operate in the second half of next year, receive Good Manufacturing Practice (GMP) certification and start full operation in the second half of 2023, and achieve full operation in the second half of 2026. Researcher Lim added, "Ahead of the completion of the 4th plant, securing advance orders is expected through discussions on product volume agreements."