SINO BIOPHARM(01177) 中国银河·2024-04-11 16:00Investment Rating - The report gives a "Buy" rating for China Biopharmaceuticals (1177) for the first time [1]. Core Views - China Biopharmaceuticals is a leading large pharmaceutical company with strong commercialization capabilities, firmly committed to an innovative strategic transformation [1]. - The company has successfully transitioned from a generics-focused business to a leading player in innovative drugs, with a rich pipeline of innovative products [1][4]. - The revenue for 2023 was 26.376 billion yuan, a year-on-year decrease of 8.71%, while the net profit attributable to shareholders was 2.33 billion yuan, down 8.32% year-on-year [1][8]. Summary by Sections Company Overview - China Biopharmaceuticals is a subsidiary of Charoen Pokphand Group, established in 1921, and entered the Chinese pharmaceutical market in the 1990s [4]. - The company has evolved from primarily generics to innovative drugs, with significant investments in various pharmaceutical companies [4][5]. Financial Performance - The company’s total revenue increased from 20.951 billion yuan in 2018 to 26.376 billion yuan in 2023, with a compound annual growth rate (CAGR) of 4.57% [8][10]. - The innovative drug revenue for 2023 was 9.89 billion yuan, up 13.3% year-on-year, accounting for 37.8% of total revenue [1][12]. Innovation and R&D - The company has a pipeline of 57 innovative products, with over 10 expected to launch between 2024 and 2026 [1][12]. - R&D investment for innovative drugs accounted for 84% of total R&D spending, with a focus on four core therapeutic areas [1][14]. Market Position and Strategy - The company has cleared most risks associated with centralized procurement, with generics revenue showing stability [1][19]. - The oncology sector has become the largest revenue contributor, with sales growing from 3.188 billion yuan in 2018 to 8.801 billion yuan in 2023, reflecting a CAGR of 22.52% [10][12]. Future Outlook - Revenue projections for 2024, 2025, and 2026 are 31.730 billion yuan, 36.961 billion yuan, and 41.159 billion yuan, respectively, with expected growth rates of 21%, 16%, and 11% [2][12]. - The net profit attributable to shareholders is projected to be 2.583 billion yuan, 3.129 billion yuan, and 3.626 billion yuan for the same years, with growth rates of 11%, 21%, and 16% [2][12].