Investment Rating - The report maintains a "Neutral" rating for WuXi Biologics (2269 HK) with a target price adjusted to HKD 13.00 [2][10]. Core Views - The company's performance for 2024-25 is expected to fall short of expectations due to a decline in R&D spending from domestic innovative drug companies and uncertainties surrounding the U.S. Biologics Safety Act, which may affect long-term orders from U.S. clients [1][2]. - The report highlights that the U.S. House of Representatives has passed a milder version of the Biologics Safety Act, which allows an 8-year transition period for U.S. pharmaceutical companies to phase out collaborations with the company, but the long-term trend remains towards a gradual exit starting in 2028 [1][2]. Financial Summary - Total revenue for 2024 is projected at RMB 17,963 million, with a growth rate of 5.5% compared to 2023 [3][8]. - Shareholder net profit is expected to be RMB 3,666 million in 2024, reflecting a growth rate of 7.8% [3][8]. - Adjusted net profit for 2024 is forecasted at RMB 4,778 million, with a growth rate of 1.7% [3][8]. - The company’s revenue from the U.S. is projected to account for 47.4% of total revenue in 2023, indicating significant reliance on the U.S. market [2][3]. Adjustments and Projections - Revenue forecasts for 2024 and 2025 have been reduced by 7.1% and 12.4%, respectively, while shareholder net profit estimates have been lowered by 16.2% and 18.3% for the same periods [1][2]. - The report adjusts the DCF model's perpetual growth rate assumption to 1.0% due to concerns about the company's long-term outlook [2][3].
药明生物：预计2024-25年业绩将逊预期，长远看仍面对挑战