| 思派健康(00314) | 5.00 万 | 18.72 万 | 1383.92 万 | 1.815% | | --- | --- | --- | --- | --- | | 中国有赞(08083) | 200.00 万 | 18.20 万 | 1920.00 万 | 0.059% | | 骏杰集团控股(08188) | 10.00 万 | 8.40 万 | 20.00 万 | 0.042% | | 滨海投资(02886) | 5.60 万 | 5.66 万 | 31.20 万 | 0.023% | | 玄武云(02392) | 2.90 万 | 2.62 万 | 339.05 万 | 0.605% | | 天福(06868) | 3000.00 | 9530.00 | 17.30 万 | 0.016% | | 清科创业(01945) | 3600.00 | 5300.00 | 10.92 万 | 0.036% | | 彩客新能源(01986) | 7000.00 | 4910.00 | 27.90 万 | 0.029% | | 华检医疗(01931) | 2000.00 | 4260.00 | 182. ...

Group 1: Hong Kong Stock Market Highlights - Mixue Group (02097) rose over 7%, reaching a new high, with Daiwa raising its target price to HKD 608, optimistic about same-store sales growth and store opening speed [1] - Lianlian Digital (02598) increased nearly 10% following the official enactment of the "Stablecoin Regulation" in Hong Kong [1] - Automotive stocks collectively declined, with Li Auto-W, Great Wall Motors, and GAC Group all dropping over 2%, as the Ministry of Industry and Information Technology and the China Association of Automobile Manufacturers opposed "involution-style" price wars [1] - CSPC Pharmaceutical Group (02005) fell over 7% after reporting a 36.9% year-on-year decline in revenue and a 59.5% drop in net profit attributable to shareholders for Q1, with expectations of a 45%-60% decline in profit for the first half of the year due to demand drop and intensified competition [1] - Solar energy stocks dropped across the board, with New Special Energy, Xinyi Energy, Fuyao Glass, and Xinyi Solar all declining over 4%, as the anticipated "531" rush in May did not materialize following the April rush [1] - Chinese property stocks fell collectively in early trading, with R&F Properties, Sunac China, New City Development, and Agile Group all dropping over 4%, as data showed a 10.8% year-on-year decline in sales for the top 100 real estate companies from January to May, with a 17.3% drop in May alone [1] Group 2: Other Notable Stocks - Chongqing Rural Commercial Bank (03618) rose nearly 5% after being included in the CSI 300 Index, becoming the first local financial institution from Chongqing to be included, with a 6.25% year-on-year increase in net profit attributable to shareholders for Q1 [2] - Baker Hughes (02149) increased over 8%, reaching a new high after completing a placement of 3 million new H-shares, raising approximately HKD 117 million [2] - Giant Bio (02367) fell over 4% amid ongoing controversies regarding its product components, with the company stating it received an apology from the relevant testing agency and will pursue accountability for the rumors [2] - Chip stocks declined across the board, with Hua Hong Semiconductor, Jingmen Semiconductor, SMIC, and Shanghai Fudan all dropping over 2%, influenced by fluctuating U.S. policies and a decline in the Philadelphia Semiconductor Index [2] - Beike-W (02423) dropped nearly 6% as Huaxi Securities reported a significant slowdown in second-hand housing transaction growth, with a mere 8% year-on-year increase in 15 cities for the first 29 days of May, the lowest since October of the previous year [2] Group 3: U.S. Stock Market Highlights - AstraZeneca (AZN.US) rose over 2% after its cancer drug Imfinzi received EU approval for specific muscle-invasive bladder cancer treatments [3] - Trump Media & Technology Group (DJT.US) increased over 2.4% after announcing the completion of approximately USD 2.44 billion in financing, planning to use about USD 2.32 billion for Bitcoin reserves, potentially becoming one of the largest Bitcoin holders among U.S. public companies [3] - Nvidia (NVDA.US) fell over 2.92% after the CEO announced plans to sell up to 6 million shares by the end of 2025 [3] - Palantir (PLTR.US) rose over 7.73% as reports indicated the Trump administration relies on its technology for inter-agency data sharing, with over USD 113 million in government contracts since Trump took office [3] - Costco (COST.US) increased over 3.12% after reporting Q3 earnings that exceeded expectations, with revenue of USD 63.2 billion, an 8% year-on-year increase, and EPS of USD 4.28, demonstrating its scale advantage and member loyalty [3]

Core Viewpoint - The National Healthcare Security Administration (NHSA) has initiated an investigation into six companies for collusion and price negotiation during the national drug procurement process, marking the first instance of such violations since the implementation of centralized drug procurement in China [1][4]. Group 1: Investigation and Penalties - Six companies have been disqualified from the seventh round of national drug procurement due to collusion in bidding and have been placed on a "blacklist," facing a suspension of participation for 6 to 12 months [3][7]. - This incident is referred to as the "largest collusion case" in national drug procurement history [4]. - The involved companies include Chengdu Xinjie High-tech Development Co., Ltd., Renhe Yikang Group Co., Ltd., Guangzhou Yipin Hong Pharmaceutical Co., Ltd., Shijiazhuang Fourth Pharmaceutical Co., Ltd., Shanghai Xudong Haipu Pharmaceutical Co., Ltd., and Jiangxi Yiyou Pharmaceutical Co., Ltd. [7]. Group 2: Financial Impact - The collusion has resulted in a loss of approximately 266 million yuan for the procurement side, with Yipin Hong committing to refund the entire amount based on sales data from 2022 to present [8]. - The average winning price for the involved drug, Ambroxol Hydrochloride Injection, was 17.95 yuan, with a price drop of 22%, making it one of the least reduced products in the procurement [9]. Group 3: Market Implications - The blacklisting of these companies may lead to increased competition among other firms for the market share of Ambroxol Hydrochloride Injection, as the involved companies accounted for over 90% of its sales in public hospitals [11]. - The NHSA has emphasized the importance of compliance with laws and regulations in drug procurement, warning that collusion will lead to penalties and damage to corporate reputation [11].

Core Viewpoint - Shijiazhuang Four Pharmaceutical has received approval for its generic drug, Deferasirox dispersible tablets (125mg), marking it as the third domestic company to pass the consistency evaluation for this product in China [1][8]. Group 1: Product Information - Deferasirox, developed by Novartis, is primarily used to treat chronic iron overload due to blood transfusions in patients aged 2 and above, as well as in non-transfusion-dependent thalassemia (NTDT) patients aged 10 and above [3]. - It is the first FDA-approved oral iron chelator that is routinely used, and it has been approved in over 80 countries globally [3]. - In 2022, the global sales of Deferasirox exceeded $300 million [3]. Group 2: Market Performance - In the domestic market, Deferasirox dispersible tablets were included in the national medical insurance directory in 2019 and entered the regular medical insurance directory in 2021 [5]. - In 2023, the total sales of Deferasirox dispersible tablets in hospitals across China reached 168 million yuan, representing a year-on-year growth of 15.03% [5]. - Original drug manufacturers hold a dominant market share of 96.76% in the hospital sales sector [5]. Group 3: Competitive Landscape - The first generic version of Deferasirox dispersible tablets was approved by Aosaikang in June 2021, followed by the second approval from China Medical Huashitong Biopharmaceutical in August 2024 [8]. - Shijiazhuang Four Pharmaceutical is now the third domestic company to pass the evaluation for Deferasirox dispersible tablets [8]. Group 4: Company Strategy - Shijiazhuang Four Pharmaceutical emphasizes a "combination of innovation and generics," supported by a strong innovation team and mechanisms, leading to a robust product pipeline and enhanced research outcomes [11]. - As of now, the company has had 112 products approved or deemed to have passed the consistency evaluation [11]. - In 2024, Shijiazhuang Four Pharmaceutical has already had 45 products approved, with six being the first to pass the evaluation [12].

Investment Rating - The investment rating for the company is "Outperform the Market" [5][3][27] Core Views - The company's overall performance in 2024 is under pressure due to the impact of the bromhexine hydrochloride incident, with revenue decreasing by 10.7% to HKD 57.73 billion and net profit declining by 19.5% to HKD 10.61 billion [1][7][3] - Despite short-term challenges, the long-term outlook for the formulation business is promising, with significant growth expected [3][26] - The company has maintained good cost control, with a sales expense ratio of 19.8% and a management expense ratio of 5.2% [7][1] Summary by Sections Revenue and Profitability - In 2024, the company achieved revenue of HKD 57.73 billion, down 10.7%, and a net profit of HKD 10.61 billion, down 19.5% [1][7] - The gross margin for 2024 was 50.4%, a decrease of 5.6 percentage points, while the net margin was 18.4%, down 2.0 percentage points [1][7] Business Segments - The large-volume infusion business generated revenue of HKD 37.35 billion, a decrease of 7.6%, with sales volume increasing by 6.7% to 2.036 billion bags [1][17] - The oral formulation business grew by 4.9% to HKD 5.02 billion, driven by significant sales increases in key products [2][13] - The raw material drug business saw a decline of 11.7% to HKD 7.85 billion due to international market pressures [2][13] Research and Development - The company invested HKD 2.66 billion in R&D in 2024, obtaining 112 production approvals and 7 clinical approvals [2][26] - The development of complex formulations and innovative drugs is progressing, with a focus on various advanced drug delivery technologies [2][26] Financial Forecasts - The company expects net profits to be HKD 10.37 billion, HKD 10.79 billion, and HKD 11.78 billion for 2025, 2026, and 2027 respectively, reflecting a slight decline in 2025 followed by modest growth [3][26] - Revenue projections for the next three years indicate a continued recovery, with expected growth in the formulation segment [3][26]

Financial Performance - In 2024, the company achieved a total sales revenue of approximately RMB 5.266 billion, a year-on-year decrease of 9.6%[7] - The net profit for 2024 was approximately HKD 1.061 billion, representing a year-on-year decline of 19.5%[7] - The gross profit margin for the year was 50.4%, down by 5.6 percentage points compared to the previous year[7] - For the fiscal year ending December 31, 2024, the company's total revenue decreased by 10.7% to HKD 5,773,251,000, down from HKD 6,463,009,000 in 2023[35] - The revenue from intravenous infusion products was HKD 3,734,689,000, a decrease of 7.6% compared to HKD 4,040,743,000 in the previous year, despite a 6.7% increase in overall sales volume[37] - The revenue from non-PVC soft bag infusion products was HKD 1,751,834,000, accounting for 46.9% of intravenous infusion revenue, reflecting a decline of 16.4%[37] - The revenue from active pharmaceutical ingredients was HKD 784,583,000, down 11.7% from HKD 888,867,000 in 2023, attributed to market prices not fully recovering from last year's decline[38] - The revenue from oral formulations increased by 4.9% to HKD 501,695,000, driven by growth in new products such as cefdinir capsules and rosuvastatin calcium tablets[38] - The gross profit for the year was HKD 2,908,262,000, down from HKD 3,619,639,000 in 2023, resulting in a gross margin decline of 5.6 percentage points to 50.4%[41] - Operating profit decreased by 18.0% to HKD 1,343,500,000, with an operating margin of 23.3%, down from 25.4% in the previous year[46] - Net profit attributable to equity holders fell by 19.5% to HKD 1,061,150,000, with a net profit margin of 18.4%, down from 20.4%[49] Sales and Market Activity - The company completed 44 generic names and 56 specifications for market access, with 13 generic names and 14 specifications approved in over 30 provinces[9] - The total sales volume of large-volume parenterals reached 2.036 billion bottles (bags), an increase of 6.7% year-on-year[10] - Sales revenue from oral formulations reached approximately HKD 502 million, reflecting a year-on-year growth of about 4.9%[11] - The sales of caffeine increased by approximately 44% year-on-year, with a total sales volume of 5,478 tons[11] - The company actively participated in over a thousand bidding activities, particularly excelling in provincial alliance procurement[9] - The export sales of infusion products amounted to approximately HKD 178 million in 2024, reflecting a year-on-year growth of about 9%[14] - The export volume of infusion products reached approximately 118 million bottles (bags) in 2024, a year-on-year increase of about 11%[14] Research and Development - The group obtained 112 production approvals and 7 clinical approvals during the year, maintaining a leading position in the industry[15] - A total of 131 product applications were submitted, including 76 new varieties of liquid and solid preparations[16] - The group has successfully passed consistency evaluations for 117 varieties and 156 specifications, enhancing product accessibility[18] - The group applied for 88 patents and was granted 51 patents in 2024, with a total of 552 patent applications filed to date[19] - The group is advancing the development of complex formulations, including liposomal injections and sustained-release microspheres, enhancing its technical influence in the field[17] - The company is committed to integrating "raw materials + formulations" for innovative drug development and enhancing research and development efficiency through technology[25] Corporate Governance - The board of directors consists of five executive directors, one non-executive director, and three independent non-executive directors as of December 31, 2024[69] - The company has maintained compliance with the corporate governance code as per the Hong Kong Stock Exchange's listing rules for the year ending December 31, 2024, with one exception regarding the separation of roles between the chairman and CEO[68] - The chairman, Mr. Qu Jiguang, also serves as the CEO, which the board believes is in the best interest of the company for efficient strategy execution[68] - The board is responsible for overseeing the company's business, strategic direction, and performance, ensuring compliance with legal and regulatory requirements[69] - The company emphasizes the importance of good corporate governance practices for growth and shareholder value creation[67] Employee and Compensation - Total employee compensation costs for the year ended December 31, 2024, were approximately HKD 774,835,000, an increase of 8.1% from HKD 717,031,000 in 2023, mainly due to an increase in employee numbers[54] - The number of employees increased to approximately 6,100 as of December 31, 2024, compared to about 5,600 on December 31, 2023[53] - Employee turnover rate decreased to 14.6% in 2024 from 16.5% in 2023, indicating improved employee retention[145] - The company provided a total of 3,106 workdays lost due to occupational injuries in 2024, up from 1,404 in 2023[148] - The company has maintained a zero fatality rate due to work-related incidents for three consecutive years[148] - Employee compensation is regularly reviewed and adjusted based on social development, price increases, and company performance[143] - The company promotes equal pay for equal work, ensuring that male and female employees receive the same starting salaries[143] Environmental, Social, and Governance (ESG) - The company has established a comprehensive ESG governance framework in accordance with the Hong Kong Stock Exchange's guidelines[109] - The report covers the company's environmental and social performance in China for the reporting period from January 1, 2024, to December 31, 2024[111] - The company recognizes its responsibility to operate in a more responsible and sustainable manner, integrating ESG considerations into daily operations[109] - The company has established three efficient wastewater treatment plants, utilizing advanced biochemical and physical-chemical combined treatment processes to enhance wastewater treatment efficiency and ensure discharge quality meets local government standards[125] - The company has implemented a strict waste classification management system, ensuring safe handling of hazardous waste throughout its lifecycle[126] - The company has not reported any violations of emission laws and regulations in 2024[125] - The company has engaged stakeholders through various channels, including regular meetings and community activities, to align business strategies with stakeholder expectations[118] Dividend and Shareholder Information - The company plans to distribute a final dividend of HKD 0.095 per share, totaling an annual dividend of HKD 0.175 per share, a year-on-year increase of 2.9%[7] - The total dividend for the year ending December 31, 2024, is proposed to be HKD 0.175 per share, an increase from HKD 0.17 per share in 2023[172] - The company's distributable reserves as of December 31, 2024, are approximately HKD 433,318,000, up from HKD 320,247,000 in 2023[177] - The company repurchased a total of 11,830,000 shares at a total cost of approximately HKD 44,563,000 during the year ending December 31, 2024[179] Compliance and Risk Management - The company emphasizes the importance of compliance and risk management, particularly in response to government policies affecting the pharmaceutical industry[27] - The company aims to enhance compliance standards and ensure operations adhere to principles of fairness and integrity[30] - The company has established policies for handling insider information to ensure timely and accurate public disclosure[97] - The company strictly prohibits any form of bribery or corruption and has implemented effective systems to prevent such activities[98] - The board reviewed the effectiveness of the risk management and internal control systems, concluding they are effective and sufficient for the fiscal year ending December 31, 2024[96]

证券研究报告 石四药集团 (2005 HK) 港股通 静待恢复性增长,口服/原料药稳放量 | 华泰研究 | | | 更新报告 | | --- | --- | --- | --- | | 2025 年 | 4 月 | 01 日│中国香港 | 化学制药 | 公司公告，24 年实现收入 57.7 亿港币(-10.7% yoy),净利润 10.6 亿港币 （-19.5%yoy）,低于 Wind 一致预测。公司收入/利润下滑,主因：1）收入端， 大输液板块销量正增长,但集采影响部分品种 ASP,叠加嗅己新一次性影响拖 累安瓿板块收入,及咖啡因价格同比下滑影响原料药板块表现；2）利润端下 滑幅度大于收入端主因年内客单价偏低的塑瓶及直立软袋占比提升，从而影 响毛利率表现。展望 25 年,考虑大输液收入规模企稳,口服制剂及原料药恢 复性增长,我们看好公司 25 年净利润 10%yoy，维持"买入"。 大输液：2024 销量正增长，看好 2025 收入规模企稳 大输液板块 24 年收入 37.3 亿港币(-7.6% yoy),主因:1)销量受益集采中标+ 新直立袋产能投放而持续增长(24 年销量+6.7% yoy)；2) 部分 ...

Core Viewpoint - The company reported a decline in revenue and profit for the fiscal year ending December 31, 2024, with a focus on improving market accessibility and product approvals despite challenging market conditions [1][2]. Group 1: Financial Performance - The company's revenue for the year was HKD 57.73 billion, a decrease of 10.67% year-on-year [1]. - Shareholders' profit was HKD 10.61 billion, down 19.53% compared to the previous year [1]. - Basic earnings per share were HKD 0.3582, with a proposed final dividend of HKD 0.095 per share [1]. Group 2: Product Approvals and Market Access - The company successfully completed the market access for 44 generic names and 56 specifications, with significant approvals in various provinces [2]. - The company participated in over a thousand bidding activities, achieving notable success in national and regional procurement initiatives [2]. - The company has 162 products listed in the national medical insurance directory, with new products successfully entering the 2024 updated directory [2]. Group 3: Business Segments Performance - The infusion and ampoule water products maintained stable performance, with total sales volume reaching 2.036 billion bottles (bags), a year-on-year increase of 6.7% [3]. - Sales revenue for infusion products was HKD 37.35 billion, a decrease of 7.6% due to market demand and pricing pressures [3]. - The oral formulation segment saw significant growth, with sales revenue reaching approximately HKD 5.02 billion, up about 4.9% year-on-year [4]. Group 4: Raw Material Drug Segment - The raw material drug segment experienced a sales revenue decline of 11.7%, totaling approximately HKD 7.85 billion [4]. - Caffeine sales volume increased by about 44% to 5,478 tons, while sales of metronidazole decreased by 43% [4]. - The company anticipates a stabilization and recovery in the raw material drug business in the coming year [4].

Financial Performance - In 2024, the company achieved a total sales revenue of approximately RMB 5.266 billion, a decrease of 9.6% year-on-year; in HKD, the revenue was about HKD 5.773 billion, down 10.7% year-on-year, with a gross profit margin of 50.4%, a decline of 5.6 percentage points [3]. - The net profit for 2024 was approximately HKD 1.061 billion, representing a year-on-year decrease of 19.5% [3]. - The company's revenue for the year ended December 31, 2024, was HKD 5,773,251, a decrease of approximately 10.7% compared to HKD 6,463,009 in 2023 [20]. - Gross profit for 2024 was HKD 2,908,262, down from HKD 3,619,639 in 2023, indicating a decline of about 19.6% [20]. - The operating profit decreased to HKD 1,343,500 in 2024 from HKD 1,638,901 in 2023, reflecting a reduction of approximately 17.9% [20]. - The total comprehensive income for the year 2024 was HKD 877,973, down from HKD 1,202,341 in 2023, indicating a decline of approximately 27% [21]. - Basic earnings per share for 2024 were HKD 0.3582, compared to HKD 0.4441 in 2023, reflecting a decrease of about 19.4% [21]. - The company's profit before tax for 2024 was HKD 1,281,603,000, a decrease of 19.1% from HKD 1,583,569,000 in 2023 [44]. - The actual tax expense for 2024 was HKD 205,995,000, down 19.0% from HKD 254,281,000 in 2023 [44]. - Profit attributable to equity holders decreased by 19.5% to HKD 1,061,150,000 for the year ending December 31, 2024, with a net profit margin dropping from 20.4% to 18.4% [68]. Dividend and Shareholder Returns - The company declared a final dividend of HKD 0.095 per share, with a total annual dividend of HKD 0.175 per share, an increase of 2.9% year-on-year [4]. - The company proposed a final dividend of HKD 0.095 per share for 2024, down from HKD 0.100 per share in 2023 [51]. - The total dividend declared for 2024 was HKD 517,844,000, slightly up from HKD 504,807,000 in 2023 [51]. - The company has adopted a dividend policy to consider paying two dividends annually, with an interim dividend of HKD 0.08 per share declared for the year ending December 31, 2024, compared to HKD 0.07 per share in 2023 [85]. Market and Product Development - The company completed 44 generic names and 56 specifications for market access approvals in 2024, with 13 generic names and 14 specifications approved in over 30 provinces [6]. - The company actively expanded its market presence through strategic partnerships and product innovation in the pharmaceutical packaging materials sector, enhancing market penetration and coverage [9]. - The company achieved an export volume of approximately 118 million bottles (bags) in 2024, representing an 11% year-on-year growth, with export sales amounting to approximately HKD 178 million, a 9% increase year-on-year [10]. - The company has submitted 131 product approval applications, including 76 for new liquid and solid formulations and 27 for raw materials, with several products being the first of their kind in the domestic market [12]. - The company has successfully passed consistency evaluations for 117 varieties and 156 specifications, enhancing its product structure and market accessibility [14]. - The company is actively developing innovative drugs, with its self-developed Class I new drug SYN045 currently undergoing Phase I clinical trials [12]. Research and Development - Research and development costs for 2024 were HKD 466,925,000, slightly decreased from HKD 471,076,000 in 2023 [40]. - The company has applied for 88 patents and was granted 51 patents in 2024, with a total of 552 patent applications and 340 granted patents to date [14]. - The company has made significant progress in the development of complex formulations, establishing technology platforms for sustained release and lipid-based formulations [13]. - Research and development costs were approximately HKD 265,969,000, a decrease of 8.2% from HKD 289,748,000 in 2023, due to savings in raw materials and other direct R&D costs [64]. Financial Position and Assets - Non-current assets increased to HKD 7,542,759 thousand in 2024 from HKD 6,842,219 thousand in 2023, representing a growth of approximately 10.3% [22]. - Current liabilities decreased significantly from HKD 2,521,440 thousand in 2023 to HKD 1,820,950 thousand in 2024, a reduction of about 27.8% [22]. - Total assets less current liabilities rose to HKD 10,782,730 thousand in 2024, up from HKD 9,444,896 thousand in 2023, indicating an increase of approximately 14.2% [22]. - Non-current liabilities increased to HKD 3,247,080 thousand in 2024, compared to HKD 2,176,204 thousand in 2023, reflecting a growth of around 49.3% [23]. - The company's total equity reached HKD 7,535,650 thousand in 2024, up from HKD 7,268,692 thousand in 2023, marking an increase of approximately 3.7% [23]. - The company's cash and cash equivalents decreased from HKD 1,615,208 thousand in 2023 to HKD 1,257,702 thousand in 2024, a decline of about 22.1% [22]. - Inventory levels increased slightly from HKD 1,086,282 thousand in 2023 to HKD 1,109,462 thousand in 2024, representing a growth of approximately 2.1% [22]. - Trade receivables rose to HKD 2,226,355 thousand in 2024 from HKD 2,177,050 thousand in 2023, an increase of about 2.3% [22]. Corporate Governance and ESG - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange rules, except for the separation of the roles of Chairman and CEO, which are held by the same individual, Mr. Qu Jiguang [82]. - The company emphasizes the importance of environmental sustainability and social responsibility, integrating ESG considerations into daily operations [83]. - The company acknowledges the increasing focus of investors and stakeholders on ESG matters and aims to operate responsibly and sustainably [83]. Operational Efficiency - Sales and distribution costs significantly reduced by 25.4% to HKD 1,143,425,000, reflecting improved efficiency in sales channels and increased sales through centralized procurement [62]. - The company incurred a financial cost of HKD 126,881,000 in 2024, slightly higher than HKD 125,413,000 in 2023 [39]. - The net financial costs for the year ending December 31, 2024, increased by 2.8% to HKD 88,390,000 compared to HKD 85,942,000 in 2023 [66]. Future Outlook - The company aims to achieve a sales volume target of 2.15 billion infusion products by 2025, representing a growth of about 6% compared to 2024 [16]. - The group plans to strengthen its clinical business team and focus on the market development of several key products, including Azithromycin tablets and others, to enhance market presence [16]. - The company targets a revenue growth rate of 20% for its raw material drug segment by 2025, focusing on high-value specialty products [17]. - The group aims to obtain 98 various national approvals by 2025, including 33 for liquid formulations and 26 for solid formulations [18].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 5.30 [1] Core Views - The company's 1-9M24 revenue was HKD 4.534 billion (-4.7% YoY), with a net profit of HKD 919 million (-2.8% YoY) [2] - The decline in revenue was attributed to stable growth in the large infusion sector but was offset by the impact of centralized procurement on ASP and a one-time impact from a specific product [2] - The net profit margin improved by 0.4 percentage points YoY due to optimized sales expenses [2] - The report expects the company's 2024 net profit to be HKD 1.35 billion, driven by seasonal demand in the large infusion sector and stabilized raw material prices [2] Large Infusion Sector - The large infusion sector generated HKD 2.97 billion in revenue (-1% YoY) in 1-9M24, with a 13.4% YoY increase in sales volume but a 12.7% YoY decline in ASP due to centralized procurement [3] - The sector is expected to grow steadily in 2024, with sales exceeding 2.2 billion bottles/bags, driven by seasonal demand, increased capacity utilization, and the expansion of high-margin products like peritoneal dialysis fluid [3] Raw Material Sector - The raw material sector reported HKD 598 million in revenue (-6.6% YoY) in 1-9M24, with caffeine prices stabilizing and azithromycin expected to see both volume and price increases in 2024 [4] - The ampoule sector saw a significant revenue decline (-30.5% YoY) due to a one-time impact but is expected to recover with HKD 700 million in revenue in 2024 [4] Solid Formulation Sector - The solid formulation sector achieved HKD 339 million in revenue (+5.3% YoY) in 1-9M24, with expected revenue of HKD 500 million in 2024 due to new product approvals and the deepening of the raw material/formulation integration strategy [4] Financial Forecasts and Valuation - The company's 2024/2025/2026 EPS is forecasted to be HKD 0.46/0.53/0.59, with a target price of HKD 5.30 based on a 10x PE ratio for 2025 [5] - Revenue is expected to grow from HKD 6.528 billion in 2024E to HKD 8.386 billion in 2026E, with net profit increasing from HKD 1.354 billion in 2024E to HKD 1.744 billion in 2026E [1][5] - ROE is projected to remain stable around 18.45%-18.84% from 2024E to 2026E [1]