Summary of the Conference Call for Boya Bio-Pharmaceuticals Company Overview - **Company**: Boya Bio-Pharmaceuticals - **Industry**: Blood products and biopharmaceuticals Key Points Industry and Regulatory Changes - Starting January 2026, the value-added tax on blood products will increase from 3% to 13%, leading to a significant decline in the company's actual pre-tax prices and creating substantial uncertainty for 2026 performance. The company is currently seeking policy exemptions from the State Administration of Taxation [2][8] - The blood products industry is facing increased pressure from price controls and expanded procurement policies, which are expected to impact pricing and inventory levels [4][8] Financial Performance and Projections - In 2025, the company achieved a plasma collection volume of 662.31 tons, a 5% increase year-over-year, with Green Cross contributing 119.91 tons, reflecting a 10.46% growth [2][5] - The consolidated gross margin for 2025 is projected at 49.9%, a decrease of 14.8 percentage points, primarily due to the lower margin of Green Cross and overall industry price pressures [2][5] - The company anticipates that the new production process for Green Cross's immunoglobulin will enhance yield from 1,200-1,300 units/liter to levels comparable to Boya's standards [2][5] Research and Development - The company has accelerated its R&D pipeline, with approvals for 10% concentration immunoglobulin and human tetanus immunoglobulin, and clinical approval for PCC [2][10] - The company aims to expand its international sales, particularly in "Belt and Road" markets, with products currently in the registration phase in various countries [2][10] Strategic Focus and Business Segmentation - Boya is actively divesting non-blood product businesses, having completed the disposal of Boya New and is targeting the divestiture of Nanjing New Hundred by 2026 to focus entirely on blood products [2][14] - The company is implementing integrated management across its 21 plasma stations to enhance efficiency and reduce costs, particularly in key provinces like Jiangxi and Anhui [7][9] Market Competition and Challenges - The introduction of recombinant human albumin is not expected to pose a significant threat in the short term due to its higher costs and limited indications compared to human-derived products [3][13] - The company is exploring ways to manage the competition from imported albumin by discussing potential regulatory adjustments with national authorities [3][13] Future Outlook - The company is optimistic about its growth trajectory, aiming to exceed the industry average growth rate of approximately 5.5% in 2026 [2][5][9] - Despite the challenges posed by regulatory changes and market pressures, the company plans to enhance operational efficiency and maintain a focus on high-quality development through innovation and strategic marketing [17] Conclusion - Boya Bio-Pharmaceuticals is navigating a complex regulatory environment while focusing on growth in its core blood products business. The company is committed to improving operational efficiencies and expanding its market presence, particularly in international markets, while managing the challenges posed by increased taxation and competition.

Core Viewpoint - The company reported a revenue of 3.11 billion yuan in the first half of 2025, representing a year-on-year growth of 9.47%, while the net profit attributable to shareholders decreased by 12.88% to 633 million yuan [1] Group 1: Financial Performance - In Q2 2025, the company achieved a revenue of 1.793 billion yuan, with a year-on-year growth of 10.70%, but the net profit attributable to shareholders fell by 5.13% to 388 million yuan [1] - For H1 2025, the company’s plasma collection volume was approximately 1361 tons, a year-on-year increase of 0.7%, holding about 20% of the domestic market share [2] - The revenue from immunoglobulin (IVIG) reached 1.43 billion yuan in H1 2025, up 6.56% year-on-year, with a gross margin of 49.8%, down 7.67 percentage points [2] - Albumin revenue was 1.35 billion yuan, showing a year-on-year increase of 20.8%, with a gross margin of 41.0%, down 11.61 percentage points [2] - Other blood products generated 330 million yuan in revenue, down 13.2% year-on-year, with a gross margin of 43.3%, a decrease of 14.8 percentage points [2] Group 2: Market Position and Growth Potential - The company maintains a leading position in the domestic plasma collection industry, with 107 plasma collection stations, of which 85 are operational as of H1 2025 [2] - The company is expected to achieve significant results in acquiring new plasma collection stations due to the strength of its controlling shareholder, China National Pharmaceutical Group [2] - The launch of the fourth-generation chromatography immunoglobulin (10%) is anticipated to enhance profit margins, as it is safer and more efficient compared to the third generation [3] - The company has several products in the pipeline, including subcutaneous immunoglobulin and recombinant coagulation factors, which are in various stages of clinical trials [3] Group 3: Profit Forecast - The company’s projected net profits for 2025-2027 are 1.44 billion, 1.67 billion, and 1.91 billion yuan, with year-on-year growth rates of -6.8%, 15.5%, and 14.4% respectively [3] - The current price-to-earnings ratios are estimated to be 28, 24, and 21 times for the years 2025, 2026, and 2027 [3] Group 4: Investment Rating - The company maintains a "Buy" rating [4]

Group 1 - The core viewpoint indicates that the blood products industry is expected to maintain steady growth in the first half of 2025, with a notable increase in the proportion of domestic albumin batch approvals compared to the previous year [1] - The approval batches for factor products such as factor VIII and fibrinogen are growing rapidly, reflecting companies' ongoing expansion of their factor product pipelines [1] - Companies are actively advancing research and development pipelines for recombinant products and new immunoglobulins, with several products already approved or under review for market launch [1] Group 2 - The blood products industry is anticipated to achieve overall steady growth in the second half of the year, driven by stabilizing product prices, increased plasma collection, and performance contributions from new products [1] - Companies that are industry leaders and are expected to continue expanding plasma station resources through both organic growth and external integration should be closely monitored for sustained growth in blood product business [1]

Group 1 - The core viewpoint indicates that the blood products industry is expected to maintain steady growth in the first half of 2025, with a notable increase in the proportion of domestic albumin batch approvals compared to the previous year [1] - The approval growth rate for factor products such as factor VIII and fibrinogen is accelerating, reflecting companies' ongoing expansion of their factor product pipelines [1] - Companies are actively advancing the research and development of recombinant products and new immunoglobulins, with several products already approved or under review for market launch [1] Group 2 - The blood products industry is projected to achieve overall steady growth in the second half of the year, driven by stabilizing product prices, increased plasma collection, and performance contributions from new products [1] - It is recommended to focus on leading companies in the industry that are likely to continue expanding plasma station resources through both organic growth and external integration, ensuring sustained growth in blood product business [1]