Investment Rating - The investment rating for WuXi AppTec (2268 HK) is maintained at "Buy" with a target price of HKD 82.24 [8][14]. Core Insights - WuXi AppTec is expected to see significant revenue growth in 2025, with revenue, gross profit, net profit, and adjusted net profit projected to increase by over 45%, 70%, 38%, and 65% year-on-year, respectively [1][2]. - The company plans to acquire Dongyao Pharmaceutical for approximately HKD 3.09 billion, which is anticipated to enhance its competitive edge and capacity [5][6]. - The demand for Contract Research, Development, and Manufacturing Organization (CRDMO) services is expected to rise as global Antibody-Drug Conjugate (ADC) pipelines commercialize [1][3]. Revenue and Profit Forecast - Revenue for 2025 is estimated at approximately HKD 59.6 billion, with a gross profit of HKD 21.1 billion and a net profit of HKD 14.7 billion [2][12]. - The gross margin is projected to be around 35.4%, an increase of about 5 percentage points from 2024, indicating strong operational efficiency [2][12]. - Adjusted net profit is expected to grow by over 65% for the year, despite a decline in profit margins in the second half of 2025 due to foreign exchange impacts and rising expense ratios [2][12]. Project Pipeline - The company signed 70 new iCMC projects in 2025, with 22 being molecular projects, contributing to a total of 252 iCMC projects [3]. - WuXi AppTec is expected to lead in the development of new conjugated molecules, with over half of the new projects being innovative types [3]. - The global market share is projected to increase from 21.7% in 2024 to over 24% in 2025 [3]. Capacity Expansion - The company is expanding its production capacity, with existing DP capacity in Wuxi being maintained and expanded in 2025 [4]. - New production facilities in Singapore are expected to be operational by mid-2025, with additional overseas capacity coming online in 2026 [4]. - The acquisition of the Hefei base is expected to enhance peptide development and production capabilities, with an annual capacity exceeding 40 kg [4]. Acquisition of Dongyao - The acquisition of Dongyao Pharmaceutical is expected to strengthen WuXi AppTec's existing competitive position, as Dongyao has significant production capabilities and a strong client base [5][6]. - Dongyao operates two antibody bulk production lines and three independent ADC bulk production workshops, which will complement WuXi AppTec's offerings [5]. Earnings Forecast and Valuation - Adjusted net profit forecasts for 2025, 2026, and 2027 are revised to HKD 15.9 billion, HKD 22.4 billion, and HKD 31.6 billion, respectively, reflecting a CAGR of 39% [6][12]. - The target price is based on a PEG ratio of 1.06x for 2026, aligning with comparable companies in the sector [6][14].
药明合联（02268）：2025营收快速攀升，收购东曜强化龙头优势