Core Viewpoint - The company plans to complete its H-share issuance and listing as part of its "innovation + internationalization" strategy, marking its first external equity financing since its A-share listing in 2000 [2][3]. Group 1: Timing and Market Context - The timeline for the company's Hong Kong listing has been rapid, with key milestones achieved within five months, reflecting a strategic response to the evolving pharmaceutical regulatory and market landscape in China [3]. - The international capital market's increasing acceptance of Chinese innovative drugs is a significant factor in the company's decision to list in Hong Kong, which serves as a bridge to global markets [5]. - The listing will provide the company with flexible financing tools to support its international expansion efforts [5]. Group 2: Strategic Goals and Achievements - The listing is aimed at expanding the company's overseas business and enhancing international research collaborations, thereby achieving breakthroughs in foreign markets [6]. - The current trend of high-quality Chinese companies listing in Hong Kong is expected to attract capital returning from a weakening US dollar [7]. - The company has made significant strides in its global presence, with products registered in over 40 countries and regions, and has established 14 global R&D centers [8]. Group 3: Financial Performance and Future Plans - The company reported a revenue of 27.985 billion yuan in 2024, a year-on-year increase of 22.6%, and a net profit of 6.337 billion yuan, up 47.3% [11]. - The funds raised from the listing will primarily be used for innovative drug development, international expansion, and operational capital, aiming to enhance its market presence [11]. - The company is positioned to transition from a domestic leader in innovative drugs to a global pharmaceutical player, with the Hong Kong listing seen as a starting point rather than an endpoint [11].

Investment Rating - The report indicates a cautious outlook for the pharmaceutical sector in 2024 and early 2025, with a strong focus on the innovative drug segment as a key investment opportunity [1][5]. Core Insights - The pharmaceutical sector is expected to face continued pressure on overall performance and profit margins due to factors such as healthcare payment environment, industry regulation, and changing consumer conditions in 2024 and Q1 2025 [1][18]. - Despite the challenges, there is optimism for a recovery in the pharmaceutical sector in the second half of 2025, driven by easing pressures from policies and fundamentals, leading to a potential turnaround in performance and stock prices [1][21]. - The innovative drug segment is highlighted as a primary focus for investment, with expectations for significant growth and valuation recovery for leading companies in this space [2][5]. Summary by Sections Pharmaceutical Sector Overview - The innovative drug segment is performing well, with leading companies like BeiGene and Hengrui Medicine showing strong revenue and business development (BD) income growth [2][22]. - The overall pharmaceutical sector is under pressure, with profit margins declining, except for the innovative drug segment which is experiencing independent growth [1][18]. Biopharmaceuticals - The biopharmaceutical sector is facing challenges, but there are opportunities for growth in specific areas such as long-acting interferons and insulin products, which are expected to see a turnaround [2][4]. Retail Pharmacy - The retail pharmacy sector is showing signs of marginal improvement, with expectations for a gradual return to normal growth in 2025 [2][4]. Medical Services and Aesthetic Medicine - The medical services and aesthetic medicine sectors are experiencing a mild recovery, with expectations for sustained performance in 2025 [3][4]. Traditional Chinese Medicine - The traditional Chinese medicine sector is expected to improve gradually throughout the year, following a challenging 2024 [4][12]. Medical Devices - The medical device sector is anticipated to recover gradually, with significant growth expected from overseas market expansion [4][12]. Investment Recommendations - The report emphasizes the importance of focusing on innovative drug opportunities throughout 2025, particularly in companies with strong international capabilities and those involved in business development [5][21].

Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The long-term landscape for large-volume infusion and intermediates is stable, and the innovative drugs have market potential overseas [5] - The company has a strong competitive position in the large-volume infusion market and is expected to achieve significant cost reductions in 2025 [7] - The company has a leading global ADC research platform, with substantial potential in overseas markets [7] - The company is transitioning successfully from generics to innovation, with significant R&D investments expected to yield results [7] - The forecasted net profit for 2025-2027 is 27.4 billion, 33.7 billion, and 39.6 billion RMB, with corresponding growth rates of -6.7%, 23.2%, and 17.5% [7] Financial Summary - The company's revenue for 2023 is projected at 21,454 million RMB, with a year-on-year growth rate of 13.44% [6] - The net profit for 2023 is estimated at 2,456 million RMB, reflecting a year-on-year growth of 43.74% [6] - The earnings per share (EPS) for 2023 is expected to be 1.54 RMB [6] - The company’s total market capitalization is approximately 57,865.51 million RMB, with a closing price of 36.21 RMB [3][4]

值得关注的是，据Wind数据统计，截至发稿，港股通创新药ETF工银（159217）当前管理费率与托管 费率分别为0.4%、0.07%，其费率在同为跟踪国证港股通指数的产品中最低。 消息面上，多家A股、港股创新药企发布亮眼财报以及在研产品的阶段性突破进展。此外据证券时报， 近期全国多地政府相继出台政策，鼓励医药行业并购重组壮大发展，并提出医药产业基金的相关规划。 在更高层面，国务院国资委党委近日在《民主与法制》周刊发表署名文章中提出，对于生物医药等产业 基础比较薄弱的领域，鼓励国有企业运用并购重组、股权投资、产业基金等多种方式，加快形成产业影 响力。 中信建投证券表示，我国创新药全球竞争力持续增强，NewCo模式成为创新药出海新选择，国家政策 鼓励创新药发展，新技术推动行业快速发展，持续看好创新药行业。 Wind数据显示，截至4月29日收盘，国证港股通创新药指数（987017）近一年涨幅达48.11%，在同类指 数中居首。相关ETF方面，跟踪国证港股通指数的港股通创新药ETF工银（159217）交投活跃。港股通 创新药ETF工银当日成交额达1.54亿元，换手率5.58%，最新规模为27.27亿元。资金流向方面， ...

Group 1 - The Hong Kong innovative drug sector has rebounded rapidly due to a favorable external environment, with the China Securities Hong Kong Innovative Drug Index (931787) experiencing a significant recovery since its low on April 9, 2023 [1][3] - As of April 25, 2023, the index reached a peak of 979.92 points, showing a maximum cumulative increase of 37.43% from its previous low [1] - The overall increase in the Hong Kong innovative drug sector has outperformed the Hang Seng Technology Index, which has only seen a year-to-date increase of 12.48% compared to the innovative drug index's 31.03% [3] Group 2 - Recent data indicates a collective performance improvement among Hong Kong innovative drug companies, significantly exceeding market expectations [4] - In 2024, 10 out of 12 Hong Kong innovative drug companies with a market capitalization over 10 billion HKD reported positive revenue growth, with 8 companies also showing positive profit growth [4] - The company with the highest revenue growth is CloudTop New Drug-B (01952), with a revenue growth rate of 341.8%, while Innovent Biologics (01801) reported a net profit growth of 91.8% [4] Group 3 - The trend of "going global" has become a key topic, with Chinese pharmaceutical companies achieving significant growth in overseas licensing transactions [6][8] - The total transaction amount for licensing-out by Chinese pharmaceutical companies reached a historical high of 51.9 billion USD in 2024, indicating a strong global competitiveness in innovative drug development [6] - The NewCo model has emerged as a favorable strategy for domestic biotech companies, allowing for cash flow support and risk sharing in international collaborations [8] Group 4 - New industry trends in pharmaceuticals, such as weight-loss drugs, dual-antibody drugs, ADC drugs, and innovative medical devices, are expected to create new investment opportunities [9] - The Chinese government is increasing support for innovative drug exports, as evidenced by recent policies aimed at facilitating the import of research materials for biopharmaceutical companies [9] - Despite market fluctuations due to trade tensions, the pharmaceutical sector remains relatively insulated, presenting a favorable opportunity for large-scale investments [9] Group 5 - The Hong Kong innovative drug sector is poised for a valuation recovery, with significant inflows of capital from southbound investors since the beginning of the year [11] - As of April 24, 2023, net capital inflows from A-share investors into Hong Kong stocks reached 611.1 billion HKD, with healthcare becoming the second most net inflow sector [11] - The current price-to-earnings ratio (TTM) for the pharmaceutical and biotechnology sector is 27.1, indicating that the sector is undervalued compared to other growth sectors [12][13]

Group 1: Pet Economy Performance - The pet economy sector has shown remarkable performance, with leading companies "Guai Bao Pet" and "Zhong Chong Co." both reaching historical highs in stock prices [4][8] - Guai Bao Pet reported a revenue of 5.245 billion in 2024, a year-on-year increase of 21.22%, and a net profit of 625 million, up 45.68% [8] - Zhong Chong Co. achieved a revenue of 4.465 billion in 2024, growing 19.15%, with a net profit of 394 million, reflecting a 68.89% increase [8] Group 2: Market Trends - The performance of the pet economy is part of a broader trend in the new consumption sector, with various brands like Wei Long and Mao Ge Ping also achieving significant growth [9] - New consumer brands are characterized by strong consumer recognition and independent performance from the industry, with many achieving historical highs this year [10] Group 3: Pharmaceutical Sector Activity - The pharmaceutical sector has been active, with stocks like Jin Kai Sheng Ke and Er Kang Pharmaceutical seeing significant gains, with some stocks hitting the daily limit [12] - Jin Kai Sheng Ke reported a revenue of 176 million in Q1 2025, a 41.83% increase, and a net profit of 47.42 million, up 183.24% [12] - The innovation drug sector is expected to continue growing due to supportive government policies and increasing global competitiveness [15]

Core Insights - The Chinese innovative drug market is projected to exceed 1.13 trillion yuan in 2024, with expectations to approach 2.3 trillion yuan by 2030, indicating a high growth trend in the sector [1] - The Hong Kong pharmaceutical ETF (159718) has shown a recent decline of 0.28%, but has increased by 7.16% over the past week [1] - The liquidity of the Hong Kong pharmaceutical ETF is active, with a turnover of 17.21% and a transaction volume of 50.91 million yuan [2] Group 1: Market Performance - As of April 24, 2025, notable stock performances include Xintai Medical (02291) up 13.86%, Ascentage Pharma-B (06855) up 7.36%, and Innovent Biologics (01801) up 4.18% [1] - The Medical Innovation ETF (516820) has a recent turnover of 1.7% and a transaction volume of 28.42 million yuan, with an average daily transaction of 53.10 million yuan over the past month [4] Group 2: Index and Weighting - The CSI Hong Kong Stock Connect Healthcare Index (930965) includes 50 liquid and large-cap healthcare companies, with the top ten stocks accounting for 59.76% of the index [6] - The top ten stocks in the CSI Pharmaceutical and Medical Device Innovation Index (931484) account for 66.49%, indicating a concentration in leading companies [9] Group 3: Investment Outlook - The manager of Ping An Healthcare Fund, Zhou Sicong, emphasizes that the export of innovative drugs is largely unaffected by U.S. tariff policies due to factors such as high profit margins and the nature of intellectual property [2] - The innovative drug sector is expected to have a promising outlook for Chinese companies, with investors advised not to overreact to short-term policy fluctuations [2]

Group 1 - The innovative drug sector continues to surge, with significant price increases in "white gold" (Vitamin D3), leading to sharp gains for companies like Brothers Technology and Erkang Pharmaceutical [4][8] - The A-share market shows a mixed performance with major indices fluctuating, while over 2,500 stocks are rising, indicating a broad market interest [3][4] - Key companies in the innovative drug sector, such as Kailaiying and Rongchang Bio, reported strong earnings growth, with Kailaiying's revenue increasing by 10.1% year-on-year [5][8] Group 2 - The price of feed-grade Vitamin D3 has surged from 450 RMB/kg to 600 RMB/kg domestically, with export prices reaching 75 USD/kg, marking a significant increase [8] - Erkang Pharmaceutical reported a revenue of 354 million RMB for Q1 2025, reflecting a year-on-year growth of 28.19%, with net profit soaring by 868.91% [8] - The market for innovative drugs is largely unaffected by recent tariff policies, as companies primarily engage in collaborative R&D with overseas firms, which allows them to avoid tariffs on licensing fees [5][8]

Core Viewpoint - The investment logic of "mother holding child" is gaining attention among fund managers as they seek undervalued stocks in the Hong Kong market, particularly in the pharmaceutical sector [1][3]. Group 1: Market Trends - Following a significant surge in the stock of Boan Biotechnology, a subsidiary of Green Leaf Pharmaceutical, which rose by 66%, another subsidiary, HeartTech Medical, saw a 47% increase, indicating a trend of "smoking stocks" in the Hong Kong pharmaceutical sector [2][3]. - The influx of new capital into the Hong Kong market is evident as public funds are shifting their focus from U.S. medical device stocks to A-share and Hong Kong pharmaceutical assets [2][5]. Group 2: Fund Manager Strategies - Fund managers are increasingly adopting a strategy of directly holding shares in parent companies rather than their subsidiaries, reflecting a preference for companies with stronger business fundamentals and competitive advantages [3][4]. - A notable shift in a QDII fund's portfolio was observed, where the allocation to A-shares and Hong Kong stocks increased significantly, indicating a strategic pivot away from U.S. stocks [6]. Group 3: Industry Performance - HeartTech Medical reported a total revenue of 472 million yuan, a year-on-year increase of 44.4%, and a net profit of 246 million yuan, up 62.22%, showcasing strong performance in the sector [4]. - The pharmaceutical sector is expected to show relative gains by 2025, driven by new industry trends and a recovery from historically low valuation levels [8][9]. Group 4: Policy and Innovation - Recent favorable policies for the pharmaceutical industry, including support for drug and medical device innovation, are expected to enhance the growth prospects for innovative drug companies [9]. - The increasing global presence of Chinese innovative drug companies is highlighted by their significant contributions to international academic conferences, indicating a robust growth trajectory [9].

Core Insights - The company has achieved significant success in its internationalization strategy, with a total of 13 innovative drug licenses granted overseas, amounting to approximately $14 billion in total transaction value [1] - The company plans to continue its international strategy through a combination of internal development and external partnerships, focusing on collaborations with leading global pharmaceutical companies while retaining domestic development rights [1] - The impact of U.S. tariffs on the company's business is minimal, as overseas sales account for only 2.56% of total revenue, indicating limited exposure to tariff-related risks [2] Group 1 - The company received €160 million from Merck Healthcare and $100 million from Kailera Therapeutics as upfront payments for licensing agreements, which have been recognized as revenue [1] - The company aims to develop its own research and commercialization capabilities overseas while managing risks and adopting a cautious approach in specific advantageous areas [1][3] - The company will remain vigilant to changes in the international environment and adapt flexibly to ensure long-term stability [3]