Investment Rating - The report initiates coverage on Viva Biotech (1873.HK) with a "Buy" rating and a target price of HKD 3.5, indicating a potential upside of 133% from the current price of HKD 1.5 [1]. Core Insights - Viva Biotech is positioned as a leader in the structure-based drug discovery (SBDD) market and is expanding into the Contract Development and Manufacturing Organization (CDMO) sector, creating a comprehensive R&D and production platform [8][9]. - The company has integrated AI technology into its operations, enhancing its drug discovery capabilities and creating new market opportunities [12][59]. - The introduction of strategic investors has significantly improved the company's valuation, with a notable focus on its low valuation compared to historical levels [17][18]. Summary by Sections Company Overview - Viva Biotech, founded in 2008 and listed in 2019, specializes in SBDD and offers a range of advanced technologies for drug discovery [8]. - The company has established a strong position in the CRO market, serving over 1,568 clients, including major pharmaceutical companies [28]. Business Strategy - The acquisition of Langhua Pharmaceutical in 2020 marked Viva's entry into the CDMO sector, allowing it to provide end-to-end services from drug development to commercialization [9][59]. - The company plans to expand its production capacity by 400 cubic meters between 2024 and 2025 to support new drug commercialization [9]. Financial Projections - Revenue is projected to grow from RMB 1,987 million in 2024 to RMB 3,355 million by 2028, with a compound annual growth rate (CAGR) of approximately 14% [2]. - Net profit is expected to increase significantly, from a loss of RMB 100 million in 2023 to RMB 471 million by 2028, reflecting a strong recovery trajectory [2]. Market Position - The global CRO market is anticipated to reach USD 147.7 billion by 2030, with a CAGR of 8.7%, while the CDMO market is projected to grow to USD 231 billion, highlighting significant growth opportunities for Viva Biotech [22][59]. - The report emphasizes the company's unique "service + investment" model, which combines immediate cash flow from CRO services with long-term gains from investments in biotech startups [9]. Competitive Landscape - Viva Biotech's valuation metrics, such as a 24 PE ratio for its CRO business, indicate a favorable investment opportunity compared to peers [3]. - The company has a competitive edge through its advanced technology platforms and a strong focus on AI-driven drug discovery, setting it apart from competitors in the industry [12][59].
维亚生物（01873）：AI驱动药物研发革命，开启全球一体化CRDMO业务新增长篇章