SINO BIOPHARM(01177) 平安证券·2024-10-08 06:11Investment Rating - The report recommends a "Buy" rating for China Biopharmaceuticals (1177.HK) for the first time [2][5]. Core Views - China Biopharmaceuticals is a leading player in the Chinese pharmaceutical industry, with expected continuous improvement in profit margins. The company reported a revenue of 26.199 billion yuan in 2023, a decrease of 8.97%, primarily due to the sale of its stake in Zhengda Qingdao and the impact of medical anti-corruption measures. However, the revenue from continuing operations showed a slight increase of 0.7% year-on-year [3][5]. - The company is advancing its innovation and internationalization strategies across four core business segments: oncology, liver disease, respiratory, and surgical/pain management. The R&D expenditure in 2023 was 4.403 billion yuan, accounting for approximately 16.8% of revenue, with over 77% of this investment directed towards innovative and biological drugs [3][5][19]. Summary by Sections Company Overview - China Biopharmaceuticals is a key player in the Chinese pharmaceutical sector, with a stable shareholding structure and absolute control over its core subsidiaries. The company is part of the Charoen Pokphand Group, which has a strong global presence [10][13]. Financial Performance - The company’s revenue for 2023 was 26.199 billion yuan, reflecting a decline of 8.97%. However, the first half of 2024 saw a revenue increase of 11.1%, reaching 15.874 billion yuan, indicating a return to positive growth [3][15]. - The adjusted net profit for the first half of 2024 was 1.540 billion yuan, up 14.0% year-on-year, signaling a potential turning point in profitability [3][15]. Business Segments - The oncology segment is expected to drive significant growth, with key products like Anlotinib and innovative therapies showing strong market potential. The company anticipates that Anlotinib will achieve a peak sales target of 10 billion yuan [21]. - The liver disease segment is also promising, with products like Magnesium Isoglycyrrhizinate expected to synergize with oncology offerings. The company has several products in late-stage clinical trials for NASH [19][21]. - The respiratory segment is positioned for growth, with inhaled formulations like Budesonide showing strong sales potential. The company has multiple innovative candidates in late-stage clinical trials [19][21]. - The surgical/pain management segment is supported by products like Flurbiprofen Gel, which is expected to contribute to revenue growth [19][21]. R&D and Innovation - The company is committed to expanding its R&D efforts, with a focus on innovative drugs. In 2023, R&D expenses reached 4.403 billion yuan, with a significant portion allocated to innovative drug development [19][21]. - The company plans to launch over 10 innovative products in the next three years, further enhancing its competitive position in the market [19][21].