reports
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Stay focused, stay innovative.
Biopharmaceutical companies are embracing the new year with new product approvals and out-licensing deals, while leading CRDMO companies are divesting their overseas businesses. We expect the biopharmaceutical segment to continue recovering, supported by a lower capital cost and constant innovative product launches in China and overseas. The considerable geopolitical risks, however, may continue to cloud the CRDMO segment’s growth outlook. Maintain UNDERWEIGHT.
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
603882 GUANGZHOU KINGMED DIAGNOSTICS GROUP CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300765 WUXI APPTEC CO. LTD. CLASS H
300244 CSPC INNOVATION PHARMACEUTICAL CO L
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Striving for growth in 2025.
Geopolitical tensions and weak economic conditions may cloud 2025’s growth outlook of the CRDMO, medical devices and services segments. However, the biopharma segment will see continued recovery, supported by a lower cost of capital and constant innovative product launches in China and even overseas. Leading internet healthcare players, with stabilising business models, also expect robust revenue growth and improving profitability. Maintain MARKET WEIGHT.
300015 AIER EYE HOSPITAL GROUP CO. LTD. CLASS A
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
603882 GUANGZHOU KINGMED DIAGNOSTICS GROUP CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300765 WUXI APPTEC CO. LTD. CLASS H
300244 CSPC INNOVATION PHARMACEUTICAL CO L
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
WuXi AppTec (2359 HK): 9M24: Results in line; biosecure concerns remai...
WuXi AppTec’s reported 9M24 revenue and adjusted net profit declined 6.2% yoy and 10.1% yoy respectively. The results are in line with our estimates. The company sees strong backlog growth of 35.2% yoy in 9M24, and maintains its revenue guidance of Rmb38.3b-40.5b for 2024. We remain cautious on the company’s long-term growth outlook given its significant exposure to geopolitical risks. Maintain SELL and target price of HK$40.00.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Colin Lee
- Gigi Cheuk
- Greater China Research Team
- Johnny Yum Chung Man
- Kate Luang
- Ken Lee
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
Greater China Daily: Wednesday, October 30, 2024
KEY HIGHLIGHTS Initiate Coverage VSTECS Holdings (856 HK/BUY/HK$4.46/Target: HK$5.47) VSTECS is the eighth-largest IT distributor globally with an established presence in SEA and China. We forecast a three-year net profit CAGR of 9.2% in 2024-26, fuelled by the rising adoption of AI, refresh cycles for consumer electronics and diversifying cloud services. We like VSTECS’ operating efficiency and cash conversion. We expect a dividend yield of 4.4%/5.1% in 2024-25 on solid cash flow generation...
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Improving funding environment and potential fiscal e...
We expect the continuous interest rate cuts to lower R&D costs and accelerate innovative product launches for biopharmaceutical producers. This will support a continuous recovery of the healthcare industry for the next few years. Moreover, the highly-expected fiscal easing package may also be a potential catalyst for medical service and medical equipment players. Maintain MARKET WEIGHT on China’s healthcare sector.
300015 AIER EYE HOSPITAL GROUP CO. LTD. CLASS A
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
603882 GUANGZHOU KINGMED DIAGNOSTICS GROUP CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300765 WUXI APPTEC CO. LTD. CLASS H
300244 CSPC INNOVATION PHARMACEUTICAL CO L
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Mixed growth outlook. MARKET WEIGHT
Most biopharmaceutical companies under our coverage posted robust 1H24 results, while others reported moderate growth or missed market estimates. We believe leading drug innovators will outperform, supported by continued new product launches, while weak economic conditions and policy uncertainties may continue to cloud the growth outlook for medical service providers and medical device players. Geopolitical risks remain a threat to CDMO majors. Maintain MARKET WEIGHT.
300015 AIER EYE HOSPITAL GROUP CO. LTD. CLASS A
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300765 WUXI APPTEC CO. LTD. CLASS H
300244 CSPC INNOVATION PHARMACEUTICAL CO L
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
WuXi AppTec (2359 HK): 1H24: Results below expectations; draft bill re...
WuXi AppTec’s reported 1H24 revenue and adjusted net profit declined 8.6% yoy and 14.2% yoy respectively. The results are lower than our estimates. The company saw strong backlog growth of 33% yoy in 1H24, and maintains its revenue guidance of Rmb38.3b-40.5b for 2024. However, we are concerned that the potential legislation of a US draft bill could led to a significant decrease in the number of new projects in the next few years. Maintain SELL and target price of HK$22.00.
- Carol Dou Xiao Qin
- Greater China Research Team
- Kate Luang
- Sunny Chen
- Xiaowei Wu
Greater China Daily: Wednesday, July 31, 2024
KEY HIGHLIGHTS Results WuXi AppTec (2359 HK/SELL/HK$29.85/Target: HK$22.00) WuXi AppTec’s reported 1H24 revenue and adjusted net profit declined 8.6% yoy and 14.2% yoy respectively. The results are lower than our estimates. The company saw strong backlog growth of 33% yoy in 1H24, and maintains its revenue guidance of Rmb38.3b-40.5b for 2024. However, we are concerned that the potential legislation of a US draft bill could led to a significant decrease in the number of new projects in the ne...
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: CRDMO industry -- The cold winter could last longer ...
Chinese CRDMO companies still face tremendous challenges in 2H24. Our industry check indicates that domestic CRDMO players are striving to survive in the cold winter via streamlining of their organisations and continued cost control. Moreover, the recent progress of the Biosecure Act further weakens the growth prospects for WuXi Bio and WuXi AppTec. Maintain MARKET WEIGHT on China’s healthcare sector.
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Evolving GLP-1 RAs market in China.
Novo Nordisk’s Semaglutide and Eli Lilly’s Tirzepatide are expected to obtain market approval for obesity treatment in China in 2024. Targeting both T2D and obesity indications, domestic players are racing in the development of GLP-1 RA innovative drugs and Semaglutide biosimilars. China’s GLP-1 market competition will stiffen soon. With the early mover advantage, superior efficacy and safety profile of Mazdutile, Innovent will stand out from the crowd. Maintain MARKET WEIGHT on China’s healthca...
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
603882 GUANGZHOU KINGMED DIAGNOSTICS GROUP CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300244 WUXI APPTEC CO. LTD. CLASS H
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
WuXi AppTec (2359 HK): 1Q24: Results below expectation; draft bill res...
WuXi AppTec’s reported 1Q24 revenue and adjusted net profit declined by 11.0% yoy and 18.3% yoy respectively. The results are lower than our estimates. The draft Bill brings considerable business uncertainty for the company and has led to a decrease in new projects. Thus far, the overall business has remained relatively stable. Management maintains its revenue guidance of Rmb38.3b-40.5b for 2024. Maintain SELL and target price of HK$28.00.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Ceilica Su Rui
- Greater China Research Team
- Jo Yee Ng
- Johnny Yum Chung Man
- Ken Lee
- Kenny Yong Hui Lim
- Roy Chen Chengzhi
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
- Tham Mun Hon
- Ziv Ang Sze Champ
Greater China Daily: Thursday, May 2, 2024
KEY HIGHLIGHTS Economics PMI Manufacturing PMI came in better than expected at 50.4% (-0.4ppt) and stayed in the expansionary zone for the second month. It was mainly supported by production and new orders as employment remained a drag, dropping 0.1ppt to 48.0%. Non-manufacturing hit a three-month low of 51.2%, dragged by moderation in new orders and business expectations. We expect policy support to continue and the July Politburo may see new measures being rolled out. Sector Aviation T...
PRU PRUDENTIAL PLC
600132 CHONGQING BREWERY CO.LTD CLASS A
02328 PICC PROPERTY & CASUALTY CO. LTD. CLASS H
600887 INNER MONGOLIA YILI INDUSTRIAL GROUP CO. LTD. CLASS A
002352 S.F. HOLDING CO. LTD. CLASS A
002460 GANFENG LITHIUM CO. LTD. CLASS A
002472 ZHEJIANG SHUANGHUAN DRIVELINE (A)
601012 LONGI GREEN ENERGY TECHNOLOGY CO LTD CLASS A
600019 BAOSHAN IRON & STEEL CO. LTD. CLASS A
YUMC YUM CHINA HOLDINGS INC.
2338 WEICHAI POWER CO. LTD. CLASS H
COSCO SHIPPING HOLDINGS CO. LTD. CLASS H
1772 GANFENG LITHIUM CO. LTD. CLASS H
603259 WUXI APPTEC CO. LTD. CLASS A
WUXI APPTEC CO. LTD. CLASS H
- Carol Dou Xiao Qin
- Sunny Chen
WuXi AppTec (2359 HK): 2023: Results slightly weaker than expected; Dr...
WuXi AppTec’s reported 2023 revenue and adjusted net profit grew 2.5% yoy and 15.5% yoy respectively. The results are slightly lower than our estimates. As the Draft Bill may bring considerable uncertainty in service demand, management guided for a modest revenue of Rmb38.3b-40.5b for 2024. We cut our revenue growth estimate from 8.3% to 3.3% CAGR in 2024-26 to reflect its lower growth visibility. Maintain SELL with a lower target price of HK$28.00.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Ceilica Su Rui
- Greater China Research Team
- Johnny Yum Chung Man
- Julia Pan Mengyao
- Ken Lee
- Ming San Soong
- Sunny Chen
- Ziv Ang Sze Champ
Greater China Daily: Wednesday, March 20, 2024
KEY HIGHLIGHTS Results China Resources Building Materials Technology (1313 HK/BUY/HK$1.31/Target: HK$1.85) 2023: Below expectations; aggregates evolve as the next growth driver. Upgrade to BUY. Tongcheng Travel Holdings (780 HK/BUY/HK$18.78/Target: HK$23.00) 4Q23: Top-line beat; pivoting focus to overseas tourism. WuXi AppTec (2359 HK/SELL/HK$39.55/Target: HK$28.00) 2023: Results slightly weaker than expected; Draft Bill clouds growth outlook. Xiaomi Corp (1810 HK/BUY/HK$14.86/Target: HK...
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Government’s draft plan seeks to promote a more supp...
China’s draft plan is expected to develop a more efficient and supportive ecosystem for drug innovation. We believe the government will support the development of a stronger and more innovative healthcare industry by providing more financial and regulatory resources in the next few years. Facing political headwinds, leading CRDMO players may benefit from the brighter outlook of China’s healthcare industry in the longer term. Maintain MARKET WEIGHT on China’s healthcare sector.
MSK MICROPORT SCIENTIFIC CORP.
00241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
01801 INNOVENT BIOLOGICS INC.
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
603882 GUANGZHOU KINGMED DIAGNOSTICS GROUP CO. LTD. CLASS A
1093 CSPC PHARMACEUTICAL GROUP LTD
1521 FRONTAGE HOLDINGS CORP
603259 WUXI APPTEC CO. LTD. CLASS A
2269 WUXI BIOLOGICS (CAYMAN) INC.
3692 HANSOH PHARMACEUTICAL GROUP
300244 WUXI APPTEC CO. LTD. CLASS H
DIAN DIAGNOSTICS GROUP CO
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: Becoming more innovative; valuation increasingly att...
China’s healthcare industry has experienced a slump in stock prices due to weak market sentiment. Our channel check indicates that the industry is generally in good shape and has become increasingly innovative. Most healthcare companies are improving their operating efficiency and expecting to generate stronger revenue and/or earnings growth in 2024. The recent sell-off has made valuations more attractive. BUY on weakness. Maintain MARKET WEIGHT.
300015 AIER EYE HOSPITAL GROUP CO. LTD. CLASS A
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
853 MICROPORT SCIENTIFIC CORP
2CRSI 2CRSI SA
1801 INNOVENT BIOLOGICS INC
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD
1093 CSPC PHARMACEUTICAL GROUP LTD
1833 PING AN 1833 HK PAGD
1521 FRONTAGE HOLDINGS CORP
2359 WUXI APPTEC CO LTD
603259 WUXI APPTEC CO. LTD. CLASS A
3692 WUXI BIOLOGICS CAYMAN INC
ME HANSOH PHARMACEUTICAL GROUP
2269 23ANDME HLDG CO
WUXI BIOLOGICS (CAYMAN) INC
- Carol Dou Xiao Qin
- Sunny Chen
WuXi AppTec (2359 HK): Confident in achieving 2023 targets; bodes well...
WuXi AppTec maintained its revenue guidance of 2-3% yoy growth to over Rmb40b for 2023. With its continued efforts in expanding new modality businesses, such as the TIDES, DDSU and ATU segments, we are confident that WuXi AppTec will achieve its targeted adjusted net earnings of over Rmb10b in 2023. We expect a better funding environment to support a gradual recovery in biotech investment and R&D activities in 2024, which will benefit the company with stronger revenue and earnings growth in the ...
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Jack Goh Tooan Orng
- Jonathan Koh
- Ken Lee
- Posmarito Pakpahan
- Sunny Chen
- Tanaporn Visaruthaphong
Regional Morning Notes - Friday, January 12, 2024
GREATER CHINA Sector Automobile: Weekly: PEV market share fell to 31% in the first week of 2024. Maintain UNDERWEIGHT. Top SELLs: BYD and Ganfeng Lithium. Update WuXi AppTec (2359 HK/BUY/HK$79.00/Target: HK$110.00): Confident in achieving 2023 targets; bodes well for stronger growth in 2024. INDONESIA Initiate Coverage Pertamina Geothermal Energy (PGEO IJ/BUY/Rp1,205/Target: Rp1,450): Aspiring to be a 1GW geothermal company, optimising the capital structure. MALAYSIA Sector Gloves: Following...
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Greater China Research Team
- Ken Lee
- Sunny Chen
Greater China Daily: Friday, January 12, 2024
KEY HIGHLIGHTS Sector Automobile Weekly: PEV market share fell to 31% in the first week of 2024. Maintain UNDERWEIGHT. Top SELLs: BYD, XPeng and Ganfeng Lithium. Update WuXi AppTec (2359 HK/BUY/HK$79.00/Target: HK$110.00) Confident in achieving 2023 targets; bodes well for stronger growth in 2024. TRADERS’ CORNER Swire Properties Limited (1972 HK): Trading Buy range: HK$15.00-15.50 Li Auto Inc. (2015 HK): Trading Buy range: HK$127.00-130.00
- Carol Dou Xiao Qin
- Sunny Chen
China Healthcare: A brighter outlook in 2024.
Easing pressure from the anti-corruption campaign will result in stronger sales growth for medical products. Moreover, after years of persistent R&D efforts, many Chinese biopharmaceutical companies now expect a fruitful year of innovation in 2024. In addition, potential US interest rate cuts will also provide liquidity for R&D investment and support the development of biotech and CRO segments in 2024. We expect a brighter outlook in 2024. Maintain OVERWEIGHT.
01177 SINO BIOPHARMACEUTICAL LIMITED
X2S SINOPHARM GROUP CO. LTD. CLASS H
853 MICROPORT SCIENTIFIC CORP
AAC AAC MICROTEC AB
1801 INNOVENT BIOLOGICS INC
3933 THE UNITED LABORATORIES INTE
2877 CHINA SHINEWAY PHARMACEUTICA
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
241 ALIBABA HEALTH INFORMATION TECHNOLOGY LTD
1093 CSPC PHARMACEUTICAL GROUP LTD
1833 PING AN 1833 HK PAGD
1521 FRONTAGE HOLDINGS CORP
2359 WUXI APPTEC CO LTD
603259 WUXI APPTEC CO. LTD. CLASS A
3692 HANSOH PHARMACEUTICAL GROUP
ME 23ANDME HLDG CO
2500 VENUS MEDTECH (HANGZHOU) INC.
2269 WUXI BIOLOGICS (CAYMAN) INC
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