Core Insights - WuXi Biologics reported a 16.1% year-on-year revenue growth to 9.95 billion yuan for the first half of 2025, driven by the successful execution of its "Follow and Win Molecule" strategy and expansion of service offerings in the biopharmaceutical industry [1] - The company's IFRS net profit increased by 54.8% to 2.76 billion yuan, with profit attributable to shareholders rising by 56.0% to 2.34 billion yuan, primarily due to gross profit growth and returns from investments and asset optimization [1] - WuXi Biologics added 86 comprehensive development projects in the first half of 2025, with over 70% of new projects involving bispecific/multispecific antibodies and ADCs [1] Financial Performance - The company supported 67 clinical phase III projects and 24 commercial production projects as of June 30, 2025, with a 24.9% year-on-year increase in revenue from clinical phase III and commercial production, indicating a maturation of early projects and ongoing growth of existing commercial projects [2] - WuXi Biologics has a total unfulfilled order backlog of 20.34 billion USD, with unfulfilled service orders and potential milestone payment orders amounting to 11.35 billion USD and 9 billion USD, respectively [2] - The unfulfilled orders over the next three years increased from 3.65 billion USD in December 2024 to 4.21 billion USD, reinforcing expectations for near-term revenue growth [2] Future Outlook - Based on current performance, WuXi Biologics has raised its full-year revenue guidance for 2025 [3]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 66.40 [9][14]. Core Insights - The ADC (Antibody-Drug Conjugates) sector is experiencing significant growth, with the company reporting a 71% year-over-year increase in order reserves, totaling USD 991 million by the end of 2024 [5][4]. - The company is advancing its global dual-plant strategy, with production facilities in both domestic and overseas locations being developed in an orderly manner [3][6]. - The company is expected to achieve a compound annual growth rate (CAGR) of 36% from 2024 to 2026, with adjusted net profits projected at RMB 1.62 billion, RMB 2.17 billion, and RMB 2.58 billion for 2025, 2026, and 2027 respectively [7][14]. Summary by Sections ADC Industry Development - The ADC industry is witnessing a surge in commercialization and late-stage clinical production demand, driven by recent FDA approvals of new ADCs and increased global clinical registrations by multinational corporations [4]. - Domestic ADC molecules are leading a new wave of innovation, with significant participation in major conferences and substantial business development activities [4]. Order and Growth Momentum - The company has a robust order backlog, with a total of 194 projects (up 36% year-over-year) and 15 Phase III clinical projects as of the end of 2024 [5]. - The completion of the Singapore facility is expected to attract more overseas project orders [5]. Global Dual-Plant Strategy - The new production facility in XBCM2 L2 is set to produce 60 batches of 2,000L scale antibody intermediates and 80 batches of 1,000L scale conjugated solutions annually, enhancing commercial production capacity [6]. - Expansion plans in Wuxi and the successful construction of the Singapore facility are anticipated to begin receiving overseas orders by the end of 2025 [6]. Profit Forecast and Valuation - The company’s revenue is projected to reach RMB 58.3 billion, RMB 76.1 billion, and RMB 94.1 billion for 2025, 2026, and 2027 respectively, with adjusted net profits of RMB 16.2 billion, RMB 21.7 billion, and RMB 25.8 billion [14][18]. - The report maintains a price-to-earnings (PE) ratio of 45.92 for 2025, reflecting the strong demand in the ADC sector and the company's capacity expansion [7][14].