Xin Lang Cai Jing·2025-04-29 02:48Core Insights - The company reported a revenue of 1.541 billion yuan for Q1 2025, representing a year-on-year increase of 10.10% but a quarter-on-quarter decrease of 7.4% [1] - The net profit attributable to shareholders was 327 million yuan, up 15.8% year-on-year and up 36.9% quarter-on-quarter, indicating a significant improvement in profitability [1] - The company’s operating efficiency and scale effects are believed to be the main drivers behind the better-than-expected performance [1] Financial Performance - The net profit margin for Q1 2025 was 21.2%, an increase of 1.0 percentage points year-on-year and 6.9 percentage points quarter-on-quarter [2] - The gross profit margin remained stable, with a year-on-year decrease of 1.0 percentage points but a quarter-on-quarter increase of 3.3 percentage points [2] - Total sales, management, and R&D expenses amounted to 366 million yuan, down 5.4% year-on-year and 26.4% quarter-on-quarter, leading to a reduced expense ratio of 23.7% [2] Business Development - The small molecule business showed resilience with stable revenue and a high gross margin of 45.17% [2] - Emerging businesses, including peptides, oligonucleotides, and ADCs, experienced over 80% year-on-year revenue growth in Q1, with a gross margin of 33.05% [2] - The company anticipates 12 PPQ projects in small molecules and 13 in emerging businesses by 2025, with ongoing capacity expansion in peptide production [2] Global Capacity Expansion - The Sandwich Site in the UK commenced operations in early August 2024, enhancing the company's capabilities in continuous reaction equipment and advanced manufacturing technologies [3] - Following the site’s launch, the company has secured multiple orders for analysis, process development, and kilogram-level production [3] Profit Forecast and Valuation - The company maintains its profit forecasts for 2025 and 2026, with the current stock price corresponding to a P/E ratio of 24.5x for 2025 and 21.4x for 2026 [4] - The target price is set at 102.00 yuan, implying a potential upside of 37.0% based on a P/E ratio of 33.5x for 2025 and 29.3x for 2026 [4]