Hengrui Pharma(SH:600276) CSC SECURITIES (HK) LTD·2025-09-05 08:46Investment Rating - The report assigns a "Buy" rating for the company, indicating a potential upside of 15% to 35% from the current price [2][7]. Core Insights - The company has entered into a business development (BD) agreement with Braveheart Bio for the exclusive rights to develop, produce, and commercialize the innovative drug HRS-1893 outside of Greater China, which is expected to enhance its performance significantly [7][8]. - The HRS-1893 drug, a small molecule inhibitor for hypertrophic cardiomyopathy, is currently in advanced clinical trials, with the potential to become a billion-dollar product, given the market success of similar drugs [8]. - The company has successfully completed multiple BD transactions in 2025, with a total potential deal value nearing $15 billion, which is expected to drive revenue growth and enhance profitability [8]. - The projected net profits for 2025-2027 are RMB 10.1 billion, RMB 9.1 billion, and RMB 10.4 billion, respectively, reflecting a year-on-year growth of 59.3%, -9.9%, and 14.5% [11]. - The company is expected to benefit from being included in the Hang Seng Index, which may lead to increased stock price and valuation recovery [8]. Financial Summary - The company’s revenue is projected to grow from RMB 22.82 billion in 2023 to RMB 45.40 billion in 2027, with a significant increase in net profit from RMB 4.30 billion to RMB 10.41 billion over the same period [14]. - The earnings per share (EPS) are expected to rise from RMB 0.68 in 2023 to RMB 1.57 in 2027, indicating strong growth potential [11]. - The price-to-earnings (P/E) ratio is projected to be 45X in 2025, suggesting a reasonable valuation in light of the expected growth [11].