Investment Rating - The report maintains a "BUY" rating for RemeGen, with a revised target price of HK$41.72, down from HK$57.65, indicating a potential upside of 53.7% from the current price of HK$27.15 [5][3]. Core Insights - RemeGen recorded revenue of RMB1.08 billion in FY23, with product sales contributing RMB1.05 billion, reflecting a 42% year-over-year increase. The gross profit margin improved to 76.9% from 63.4% in FY22. However, the company reported a wider attributable net loss of RMB1.51 billion in FY23 compared to RMB999 million in FY22 [3][11]. - The company anticipates a significant ramp-up in sales for FY24, targeting at least a 50% year-over-year increase in product sales, driven by strong performance of RC18 and RC48, an expanded salesforce, and inclusion in numerous top-grade hospitals [3][9]. - RemeGen is progressing with the global development of RC18, with the first stage of its Phase 3 trial completed. The company is considering whether to unblind the study results, which could serve as a catalyst for further development and potential out-licensing deals [3][10]. - The report highlights the potential for overseas business development collaborations, particularly for RC18 and RC88, which has received fast track designation from the FDA. These collaborations are expected to be crucial for RemeGen's growth trajectory [3][10]. Financial Summary - In FY23, RemeGen's revenue was RMB1,076 million, with a gross profit of RMB823 million, resulting in a gross margin of 76.5%. The company incurred operating expenses of RMB2,334 million, leading to an operating loss of RMB1,488 million [11][13]. - For FY24, the revenue is projected to reach RMB1,601 million, with a gross profit of RMB1,225 million, maintaining a gross margin of 76.5% [11][10]. - The net profit for FY24 is expected to be a loss of RMB1,451 million, improving to a loss of RMB1,070 million in FY25, and further narrowing to a loss of RMB362 million in FY26 [11][10].
Awaiting the fruition of overseas BD collaborations