Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 68.05, indicating a potential upside of 34% from the current price of RMB 50.61 [1][8][15]. Core Insights - The company is experiencing a recovery in new orders within the clinical CRO industry, with a significant increase in new contract amounts in Q1 2025, reflecting a 20% year-on-year growth [6][7]. - Despite facing challenges in 2024 due to non-recurring factors, the core business remains stable, with a net cash flow from operating activities showing a 37.26% year-on-year increase [6][7]. - The company is expanding its international presence and investing in digitalization and AI, which are expected to enhance operational efficiency and customer retention [7][8]. Financial Performance Summary - The company reported a revenue of RMB 6,603 million in 2024, a decline of 10.58% year-on-year, with a net profit of RMB 405 million, down 79.99% due to fair value losses on financial assets [6][9]. - For 2025, the revenue is projected to be RMB 7,310 million, with an estimated EPS of RMB 1.56, reflecting a significant downward adjustment from previous estimates [2][11][12]. - The company’s financial metrics indicate a recovery trajectory, with expected revenues growing at rates of 9.64%, 13.68%, and 16.87% from 2025 to 2027 [7][12]. Valuation and Market Comparison - The target price corresponds to a P/E ratio of 44x for 2025, which is above the industry average of 24x, suggesting a premium valuation due to the company's leading position in the clinical CRO sector [8][15]. - The report highlights the company's competitive edge and potential for valuation recovery as the industry improves [15][17].