Investment Rating - The report maintains a "Buy" rating for WuXi AppTec (2268.HK) [4] Core Views - WuXi AppTec reported strong annual performance for 2024, with revenue increasing by 91% year-on-year to 4.052 billion RMB and net profit attributable to shareholders rising by 277% to 1.070 billion RMB [1] - The company is experiencing robust growth in new projects and a diverse development in research projects, with 45 early discovery projects advancing to the iCMC stage and a total of 681 early discovery projects [1][2] - The company has a strong order backlog, with a total of 991 million USD in hand orders at the end of 2024, representing a 71% year-on-year increase [3] Summary by Sections Financial Performance - Revenue for 2024 reached 4.052 billion RMB, with a growth rate of 90.8% [4] - Adjusted net profit for 2024 was 1.174 billion RMB, reflecting a year-on-year increase of 185% [1] - Gross margin improved by 4.3 percentage points to 30.6%, while adjusted net profit margin increased by 7.3 percentage points to 26.4% [1] Business Development - The company signed 53 new comprehensive projects in 2024, including 9 backend production projects [1] - The production capacity at the Wuxi base is operating at high/full load, with a delivery success rate exceeding 99% [2] - The company plans to expand its production capacity significantly, with new lines expected to come online in 2025 and 2027 [2] Market Position - WuXi AppTec serves a growing client base, with 499 cumulative clients, including 13 of the top 20 global pharmaceutical companies [3] - The company anticipates continued growth in inquiries for iCMC stage projects, particularly in the U.S. market, which saw a 43% year-on-year increase in inquiries [3] Future Projections - Revenue projections for 2025, 2026, and 2027 are 5.554 billion RMB, 7.291 billion RMB, and 9.395 billion RMB, respectively, with expected growth rates of 37.1%, 31.3%, and 28.9% [4] - Net profit attributable to shareholders is projected to reach 1.342 billion RMB, 1.870 billion RMB, and 2.448 billion RMB for the same years, with growth rates of 25.4%, 39.4%, and 30.9% [4]

Investment Rating - The report maintains an "OUTPERFORM" rating for WuXi XDC Cayman, with a target price of HK$49.10 based on a current price of HK$41.90 [1][19]. Core Insights - WuXi XDC reported robust growth in 2024, with revenue reaching RMB4.052 billion, a year-on-year increase of 90.8%. The gross margin improved to 30.6%, up 4.3 percentage points, and net profit attributable to shareholders surged 277.2% to RMB1.070 billion [4][12]. - The company secured 53 new integrated projects and 23 iCMC projects in 2024, supporting clients in submitting 30 IND applications and delivering over 300 GMP production batches [5][13]. - North America emerged as the fastest-growing region, with revenue from North American clients reaching RMB2.03 billion, a 138.3% increase year-on-year, accounting for 50.1% of total revenue [15]. - The total backlog of orders reached RMB991 million, reflecting a 71% year-on-year growth, with new contract signings maintaining pace with this growth [16]. Financial Summary - Revenue projections for WuXi XDC from 2025 to 2027 are RMB5.587 billion, RMB7.387 billion, and RMB9.461 billion, representing year-on-year growth rates of 37.9%, 32.2%, and 28.1% respectively [7][18]. - Net profit attributable to shareholders is expected to be RMB1.342 billion, RMB1.818 billion, and RMB2.403 billion for the same period, with growth rates of 25%, 35%, and 32% respectively [10][18]. - The adjusted net profit is projected to be RMB1.550 billion, RMB2.010 billion, and RMB2.580 billion, with year-on-year growth rates of 32%, 30%, and 28% [10][18].

Investment Rating - The report maintains a "Buy" rating for WuXi AppTec (2268.HK) with a target price of HKD 50, indicating a potential upside of 25% from the current price of HKD 40 [1][5][10]. Core Insights - WuXi AppTec's 2024 performance slightly exceeded previous positive earnings forecasts, with revenue reaching RMB 4.052 billion, representing a year-on-year increase of 90.8%, and adjusted net profit of RMB 1.07 billion, up 277.2% year-on-year [5][7]. - The company expects to achieve a revenue growth rate of over 35% in 2025, supported by a strong order backlog of USD 990 million, which is a 71.2% increase year-on-year [5][7]. - North America is identified as a key growth driver, with revenue contribution from this region increasing to 50% in 2024, up from 40% in 2023 [5][7]. Financial Performance Summary - **Revenue Forecasts**: - 2023: RMB 2,124 million - 2024: RMB 4,052 million (90.8% YoY growth) - 2025E: RMB 5,569 million (37.4% YoY growth) - 2026E: RMB 7,618 million (36.8% YoY growth) - 2027E: RMB 9,987 million (31.1% YoY growth) [7][9]. - **Net Profit Forecasts**: - 2023: RMB 284 million - 2024: RMB 1,070 million (277.2% YoY growth) - 2025E: RMB 1,302 million (21.7% YoY growth) - 2026E: RMB 1,739 million (33.6% YoY growth) - 2027E: RMB 2,356 million (35.5% YoY growth) [7][9]. - **Profitability Metrics**: - Gross margin improved to 30.6% in 2024 from 26.3% in 2023, with adjusted net profit margin expected to remain stable [5][7]. Capital Expenditure and Growth Strategy - The company plans to invest approximately RMB 1.4 billion in capital expenditures for 2025, primarily for expanding production capacity in Singapore and Wuxi [5][7]. - WuXi AppTec aims to optimize operations to mitigate potential impacts on gross margins from new capacity coming online [5][7].

Group 1 - The Hong Kong technology sector is experiencing a rebound, with the Hong Kong Technology ETF (513560) rising over 1% and a trading turnover rate exceeding 67% [1] - The CSI Hong Kong Stock Connect Technology Index (931573) has increased by 1.19%, with notable gains from companies such as 3SBio (01530) up 11.50% and Li Auto (09863) up 5.37% [1] - The Hong Kong Technology ETF has shown a strong performance over the past year, with a 77.10% increase and a year-to-date rise of 31.42% [1] Group 2 - DeepSeek, a Chinese AI startup, has launched a new version of its model, DeepSeek-V3, which has 685 billion parameters and has significantly improved its capabilities in coding, mathematics, and reasoning [2] - The "catfish effect" from DeepSeek is expected to drive a wave of AI model applications across various industries, particularly in sectors with high digitalization [2] - China's manufacturing sector, especially in discrete manufacturing and process industries, is well-positioned for rapid AI application due to its high level of digitalization [2] Group 3 - Huatai Securities anticipates potential market volatility in April due to tariff issues and economic data releases, but remains optimistic about the long-term growth of AI technology [3] - The report suggests a "barbell strategy" for investment, focusing on Hong Kong internet and tech hardware stocks, new consumption sectors benefiting from stimulus policies, innovative pharmaceuticals related to AI, and stable dividend stocks [3] - The Hong Kong Technology ETF closely tracks the CSI Hong Kong Stock Connect Technology Index, which includes major tech companies like Xiaomi, Alibaba, and Tencent, representing 72.15% of the top ten holdings [3]

Investment Rating - The report maintains a "Buy" rating for WuXi AppTec (2268.HK) with a target price of HKD 50, indicating a potential upside of 25% from the current price of HKD 40 [1][5][10]. Core Insights - WuXi AppTec's 2024 performance slightly exceeded previous positive earnings forecasts, with revenue reaching RMB 4.052 billion, representing a year-on-year growth of 90.8%, surpassing the earlier guidance of 85% [5][7]. - The adjusted net profit for 2024 was RMB 1.07 billion, reflecting a significant year-on-year increase of 277.2%, also exceeding prior expectations of 170% growth [5][7]. - The company expects to maintain a revenue growth rate of over 35% for 2025, supported by a strong order backlog of USD 990 million, which is up 71.2% year-on-year [5][7]. - North America is identified as a key growth driver, with its revenue contribution increasing to 50% in 2024, up from 40% in 2023 [5][7]. Financial Performance and Forecast - Revenue and profit forecasts for WuXi AppTec are as follows: - 2023: Revenue of RMB 2.124 billion, net profit of RMB 284 million - 2024: Revenue of RMB 4.052 billion, net profit of RMB 1.07 billion - 2025E: Revenue of RMB 5.569 billion, net profit of RMB 1.302 billion - 2026E: Revenue of RMB 7.618 billion, net profit of RMB 1.739 billion - 2027E: Revenue of RMB 9.987 billion, net profit of RMB 2.356 billion [7][8][9]. - The report projects a compound annual growth rate (CAGR) for revenue exceeding 40% over the next three years under optimistic scenarios [19]. Valuation Metrics - The report adjusts the 2025/2026 estimated net profit upwards by 28% and 24% respectively, primarily due to increased revenue forecasts [5][7]. - The target valuation multiple is set at 1.05x PEG, corresponding to a 31x PE for 2026E, leading to the target price of HKD 50 [5][7].

Core Viewpoint - WuXi AppTec (02268) has shown significant financial growth, with a 277% increase in net profit year-on-year, driven by strong order reserves and demand for ADC drugs [1][2] Financial Performance - For the year 2024, WuXi AppTec reported revenues of approximately 4.052 billion yuan, representing a year-on-year growth of 90.8% [1] - Gross profit reached about 1.24 billion yuan, up 121.6% compared to the previous year [1] - The net profit attributable to shareholders was approximately 1.07 billion yuan, marking a 277.2% increase year-on-year [1] - Adjusted net profit grew by 184.8% to 1.174 billion yuan [1] Order Reserves - As of the end of 2024, the total amount of unfulfilled orders reached 991 million USD, reflecting a year-on-year growth of 71% [1] - The new contract amount and the growth rate of unfulfilled orders are in sync, with unfulfilled orders in North America increasing by over 100% year-on-year [1] Market Outlook - Nomura anticipates continued strong growth in fiscal year 2025 due to robust global demand for ADC drugs [1] - Based on the strong performance in 2024 and management guidance, the adjusted net profit forecast for 2025-26 has been raised by 7-10% [2] - The DCF target price has been adjusted to 51 HKD, with a focus on the progress of commercial orders and BLA submissions [2] - The company signed 53 new orders in 2024, indicating rapid expansion in the North American market and highlighting the ongoing high demand in the ADC development outsourcing industry [2]

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of 66.40 HKD [8][9]. Core Insights - The company reported strong financial performance for the fiscal year 2024, with revenue, net profit, and adjusted net profit reaching 40.5 billion, 10.7 billion, and 11.7 billion RMB respectively, representing year-over-year growth of 91%, 277%, and 185% [1]. - The company is positioned for rapid growth, benefiting from the expansion of the ADC industry, with an expected revenue CAGR of 27% from 2025 to 2027 [1]. - The company has a significant increase in project numbers and backlog orders, with a total of 194 comprehensive projects and a backlog of 9.91 billion USD, reflecting a 71% increase from the end of 2023 [2][3]. Financial Performance - The company achieved a gross margin of 30.6% in 2024, an increase of 4.2 percentage points from 2023, driven by capacity ramp-up and cost reduction [4]. - The company’s capital expenditures (CAPEX) for 2024 were 15.4 billion RMB, primarily for capacity construction in Singapore and Wuxi, with an expected CAPEX of 14 billion RMB in 2025 [4]. Earnings Forecast and Valuation - The adjusted net profit estimates for 2025 and 2026 have been raised by 8% and 18% to 16.2 billion and 21.7 billion RMB respectively, with a projected net profit of 25.8 billion RMB for 2027 [5][13]. - The company is expected to achieve a 36% CAGR from 2024 to 2026, with a target price adjustment to 66.40 HKD based on a PEG ratio of 1.28x [5][15]. Operational Metrics - As of the end of 2024, the company served 499 clients, a 45% increase year-over-year, and has introduced 69 new pipelines, reflecting a strong demand in the ADC sector [3]. - The company’s revenue contributions from pre-IND and post-IND services are projected to be approximately 16.76 billion and 23.77 billion RMB in 2024, with significant growth rates of 80.8% and 98.6% year-over-year [2].

Group 1 - The core viewpoint is that the company is experiencing strong growth driven by high industry demand and the advantages of its CRDMO model, leading to an upward revision of profit forecasts and target price [1][2] - For 2024, the company expects revenue and adjusted net profit to grow by 91% and 185% year-on-year, respectively, with 53 new contracts signed, bringing the total project count to 194 [2] - The company maintains a leading market share, having enabled clients to submit 30 IND applications, ranking first globally, and 60% of ADCBD transactions over $1 billion by Chinese companies utilized its CRDMO services [2] Group 2 - The company is expanding its global dual-factory layout, with North American revenue expected to grow by 180% in 2024, and the contribution from regions outside China increasing from 69% in 2023 to 74% [3] - The company is rapidly advancing its capacity construction in Singapore, expected to be operational by the end of 2025, while domestic capacity continues to expand with new production lines planned for 2025-2027 [3] - Management anticipates capital expenditures exceeding 1.4 billion RMB in 2025, supported by 3.5 billion RMB in cash and positive operating cash flow by the end of 2024 [3]

证券研究报告 公司研究 [Table_ReportType] 公司点评报告 [Table_StockAndRank] 药明合联 (2268.HK) [Table_Author] 唐爱金 医药首席分析师 执业编号：S1500523080002 邮 箱：tangaijin@cindasc.com 贺鑫 医药行业分析师 执业编号：S1500524120003 邮 箱：hexin1@cindasc.com 信达证券股份有限公司 CINDA SECURITIES CO.,LTD 北京市西城区宣武门西大街甲127号金隅大厦B 座 邮编：100031 [Table_Title] 全方位高增长，订单储备充足，产能持续 扩张 [Table_ReportDate] 2025 年 03 月 25 日 [Table_S 事件：2025 ummar年y]3 月 24 日，公司发布 2024 年全年业绩简报。2024 年公司 实现营业收入 40.52 亿元，同比增长 91%；实现毛利润 12.40 亿元，同比 增长 122%，对应毛利率达到 30.6%；实现净利润 10.69 亿元，同比增长 277%，对应净利率达到 26.4%；实现经 ...

证券研究报告 公司研究 [Table_ReportType] 公司点评报告 [Table_StockAndRank] 药明合联 (2268.HK) [Table_Author] 唐爱金 医药首席分析师 执业编号：S1500523080002 邮 箱：tangaijin@cindasc.com 贺鑫 医药行业分析师 执业编号：S1500524120003 邮 箱：hexin1@cindasc.com 信达证券股份有限公司 CINDA SECURITIES CO.,LTD 北京市西城区宣武门西大街甲127号金隅大厦B 座 邮编：100031 [Table_Title] 全方位高增长，订单储备充足，产能持续 扩张 [Table_ReportDate] 2025 年 03 月 25 日 [Table_S 事件：2025 ummar年y]3 月 24 日，公司发布 2024 年全年业绩简报。2024 年公司 实现营业收入 40.52 亿元，同比增长 91%；实现毛利润 12.40 亿元，同比 增长 122%，对应毛利率达到 30.6%；实现净利润 10.69 亿元，同比增长 277%，对应净利率达到 26.4%；实现经 ...