GOLDEN SUN SECURITIES·2024-03-18 16:00Investment Rating - The report maintains a "Buy" rating for WuXi AppTec (603259.SH) [3] Core Views - The company achieved a revenue of 40.34 billion RMB in 2023, a year-on-year increase of 2.5%, and a net profit attributable to shareholders of 9.607 billion RMB, up 9.0% year-on-year [1] - Excluding COVID-19 related projects, the overall revenue growth was 25.6%, with major pharmaceutical companies contributing approximately 40% of total revenue [1] - The company expects revenue in 2024 to reach between 38.3 billion and 40.5 billion RMB, with a projected growth rate of 2.7% to 8.6% [1] Financial Performance - In 2023, the adjusted Non-IFRS net profit was 10.9 billion RMB, reflecting a 15.5% year-on-year increase [1] - The chemical business revenue was 29.17 billion RMB, with a year-on-year growth of 1.1%, and a significant increase of 36.1% when excluding COVID-19 projects [1] - The TIDES business, focusing on oligonucleotides and peptides, saw a revenue increase of 64.4%, reaching 3.41 billion RMB [1][2] Revenue Breakdown - The testing business generated 6.54 billion RMB, a year-on-year increase of 14.4% [1] - The biological services segment reported a revenue of 2.55 billion RMB, up 3.1% year-on-year [1] - The ATU segment's revenue was 1.31 billion RMB, showing a slight increase of 0.1% [1] Profitability and Efficiency - The adjusted Non-IFRS gross margins for the chemical, testing, and biological services segments improved by 3.9, 1.9, and 1.5 percentage points respectively [1] - The company anticipates maintaining a similar adjusted Non-IFRS net profit margin in 2024 as in the previous year [1] Earnings Forecast - The forecasted net profits for 2024-2026 are 10.26 billion RMB, 11.75 billion RMB, and 13.37 billion RMB, representing year-on-year growth rates of 6.8%, 14.5%, and 13.8% respectively [1][2]