KPC(SH:600422) Bank of China Securities·2025-11-11 04:45Investment Rating - The report maintains a "Buy" rating for the company, with a market price of RMB 13.73 and a sector rating of "Outperform" [1][3]. Core Insights - The company reported a revenue of RMB 4.751 billion for the first three quarters of 2025, a year-on-year decrease of 18.08%. The net profit attributable to shareholders was RMB 269 million, down 39.42% year-on-year. The third quarter alone saw a revenue of RMB 1.4 billion, down 30.19% year-on-year, and a net profit of RMB 71 million, down 59.03% year-on-year. Despite these challenges, the report expresses optimism about the company's long-term development due to increased R&D investment and a deep focus on chronic disease management [3][5][8]. Summary by Sections Financial Performance - The company’s revenue for 2025 is projected to be RMB 8.564 billion, with a growth rate of 1.9%. The net profit is expected to be RMB 630 million, reflecting a decrease of 2.7% compared to the previous year. The earnings per share (EPS) for 2025 is estimated at RMB 0.83, with a price-to-earnings (P/E) ratio of 16.5 [7][9]. Revenue and Profit Forecast - The report adjusts the profit forecast slightly downward, estimating net profits for 2025-2027 at RMB 630 million, RMB 722 million, and RMB 876 million respectively. The EPS for these years is projected to be RMB 0.83, RMB 0.95, and RMB 1.16, with corresponding P/E ratios of 16.5, 14.4, and 11.9 [5][7]. Market Challenges and Strategic Adjustments - The company is undergoing channel reforms that have led to sales pressure. The integration of its 777 business unit with China Resources Sanjiu is aimed at resolving product synergy issues. The report notes that while these reforms may impact short-term performance, they are expected to stabilize and improve in the long run [8][9]. R&D Investment - The company has increased its R&D expenditure to RMB 73 million in the first three quarters of 2025, a year-on-year increase of 5.06%. It is actively developing new drugs in various therapeutic areas, including cardiovascular diseases and oncology [8][9].