WUXI XDC(2268.HK)：STRONG EARNINGS GROWTH WITH STRATEGIC ACQUISITION TO ENHANCE CAPACITY

Core Viewpoint - WuXi XDC is expected to experience significant revenue and profit growth in 2025, driven by a record number of new projects and an acquisition aimed at enhancing production capacity [1][2][3][4] Group 1: Financial Performance - WuXi XDC anticipates a revenue increase of at least 45% YoY and net profit growth of over 38% YoY for 2025 [1] - Adjusted net profit before interest income and expenses is projected to rise by more than 45% YoY, and over 65% YoY when excluding foreign exchange impacts [1] - Revenue growth forecasts for 2025E, 2026E, and 2027E are 45.7%, 36.6%, and 31.7% YoY, respectively, with adjusted net income growth of 34.9%, 38.4%, and 32.9% YoY for the same years [4] Group 2: Project Developments - In 2025, WuXi XDC signed a record-high 70 new integrated projects, marking a 32% YoY increase [2] - Among these projects, 22 were transferred from external parties, indicating growing client trust [2] - The company reported a 125% YoY increase in PPQ-stage contracts, reaching 18, which suggests strong potential for commercial manufacturing [2] Group 3: Acquisition Strategy - WuXi XDC plans to acquire at least 60% interest in BioDlink through a cash tender offer at HK$4.00 per share, representing a 99% premium over the last closing price [3] - The acquisition aims to enhance WuXi XDC's drug production capacity, particularly for ADC DS and DP, which are currently in short supply [3] - BioDlink's facilities include two mAb facilities with capacities of 500–2,000L/batch and three DS facilities capable of producing over 800kg ADC DS annually [3]