Core Viewpoint - Huaxi Securities has initiated coverage on Yuan Da Pharmaceutical, highlighting significant upside potential in the company's valuation due to its robust barriers in the nuclear medicine sector and the rollout of innovative drugs [1] Group 1: Financial Projections - The company is projected to achieve total revenues of HKD 12.27 billion, HKD 13.46 billion, and HKD 14.70 billion for the years 2025, 2026, and 2027 respectively [1] - Corresponding net profits for the parent company are expected to be HKD 2.01 billion, HKD 2.25 billion, and HKD 2.56 billion for the same years, with EPS estimates of HKD 0.57, HKD 0.63, and HKD 0.72 [1] Group 2: Product Development and Market Potential - The company has successfully completed Phase II clinical trials for its globally first drug STC3141, showing significant improvement in SOFA scores in the high-dose group compared to the baseline [1] - STC3141 targets the core of immune dysregulation in sepsis through an innovative mechanism, potentially filling a 40-year gap in targeted drug options and opening a market worth over HKD 10 billion [1] - The company is advised to monitor the subsequent Phase III clinical data and global registration plans for STC3141 [1] Group 3: Business Stability and Growth - The company maintains a solid foundation with over 260 medical insurance products, with core respiratory products like Cheno expected to drive nearly 27% growth in 2024 [2] - The revenue share from innovative and barrier products has rapidly increased to 51% in the first half of 2025, up from 36.1% in the same period last year, indicating significant transformation [2] - The company is positioned for a value reassessment cycle, supported by the growth of nuclear medicine, the launch of innovative drugs, and stable traditional business [2]