GENSCRIPT BIO(HK:01548) Southwest Securities·2024-03-14 16:00Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 32.55, based on a current price of HKD 15.52 [1]. Core Insights - The company reported a revenue of USD 840 million in 2023, representing a year-on-year growth of 34.2%. The gross profit was USD 410 million, with a growth of 34.7%. The net loss narrowed from approximately USD 430 million in 2022 to about USD 360 million in 2023 [2][3]. - The cell therapy segment, particularly CARVYKTI® (cilta-cel), showed significant growth, with external revenue of approximately USD 290 million, marking a 144.2% increase. The net trade sales for Q4 2023 and the entire year were approximately USD 159 million and USD 500 million, respectively [2][3]. - The company has expanded its production capacity by 100% since the beginning of 2023, with plans to achieve an annual capacity of 10,000 doses by the end of 2025 [2]. Summary by Sections Company Overview - The company has established itself as a leader in the gene synthesis industry, evolving into a platform-based biotechnology company with a comprehensive service offering across various life science sectors [8][10]. - The management team possesses extensive industry experience, which is expected to drive long-term growth [13]. Financial Performance - The company achieved a revenue of USD 840 million in 2023, with a projected revenue growth of 62.7% to USD 1.37 billion in 2024, and further growth to USD 2.29 billion in 2025 [4][35]. - The adjusted net loss is expected to improve, with forecasts of USD -180 million in 2024, turning to a profit of USD 200 million in 2025 [4][35]. Business Segments - The life sciences services and products segment generated approximately USD 400 million in external revenue, reflecting a 15.6% increase [3]. - The biopharmaceutical CDMO segment experienced a decline in revenue, while the industrial synthetic biology segment showed robust growth, with external revenue of approximately USD 42.9 million, a 12.2% increase [3]. Valuation - The report estimates a reasonable market capitalization of HKD 69.105 billion for 2024, corresponding to the target price of HKD 32.55 [3][36]. - The valuation approach includes a mix of PE and PS methods, reflecting the different stages of development across the company's business segments [36][39].