Core Insights - The company reported a revenue of 390 million yuan for the first half of 2025, reflecting a year-over-year decrease of 1.08%, while the net profit attributable to shareholders was 54.16 million yuan, down 1.40% year-over-year, meeting expectations [1] - The company experienced a significant improvement in performance in Q2 2025, with a revenue of 214 million yuan, a quarter-over-quarter increase of 21.06%, and a net profit of 47 million yuan, up 528.73% quarter-over-quarter [1] - The company has a strong project reserve with over 4,000 international and domestic SMO projects contracted, and 2,428 projects currently in execution, showing significant growth compared to the end of 2024 [1] Industry Demand and Growth - The growth in orders is primarily driven by the increasing demand for SMO services from domestic and international pharmaceutical companies, particularly due to the active overseas business development transactions of innovative drug companies [2] - In the first half of 2025, there were 72 transactions involving Chinese innovative drugs going overseas, amounting to 60 billion USD, contributing to incremental business for the company [2] Strategic Partnerships and Quality Recognition - The company has maintained stable cooperation with all of the top 10 global pharmaceutical companies in 2024, serving well-known clients such as AstraZeneca, Merck, Roche, Eli Lilly, BeiGene, and HengRui Medicine [2] - The company has made advancements in digital transformation, with its self-developed clinical trial execution management platform achieving data visualization and intelligent management, and has received two national invention patents [2] - The company's quality system has been recognized internationally, with no major findings during inspections by the National Medical Products Administration, FDA, and EMA [2] Financial Forecast and Valuation - The company is a leading player in the SMO sector, with a clear recovery in industry and client demand, maintaining net profit forecasts for 2025-2027 at 110 million, 125 million, and 142 million yuan respectively [2] - The current stock price corresponds to a PE ratio of 31, 28, and 24 for the years 2025, 2026, and 2027, respectively, with a "Buy" rating maintained [2]

Investment Rating - The report maintains a "Buy" rating for the company [5] Core Insights - The company reported a revenue of 390 million yuan for the first half of 2025, a year-over-year decrease of 1.08%, but showed significant quarter-over-quarter improvement with a revenue of 214 million yuan in Q2 2025, representing a 21.06% increase [1] - The net profit attributable to the parent company for the first half of 2025 was 54.16 million yuan, down 1.40% year-over-year, but increased by 528.73% quarter-over-quarter in Q2 2025 [1] - The company has a strong project reserve with over 4,000 international and domestic SMO projects, including 2,428 projects currently in execution, marking a significant growth compared to the end of 2024 [1] - The demand for SMO services is recovering, with new contracts signed amounting to 600 million yuan in the first half of 2025, a substantial increase of 40.12% year-over-year [2] - The company has maintained stable cooperation with top global pharmaceutical companies and has received international recognition for its quality system, with no major findings during inspections by regulatory authorities [3] Financial Performance Summary - The company forecasts net profits for 2025, 2026, and 2027 to be 110 million yuan, 125 million yuan, and 142 million yuan respectively, with corresponding PE ratios of 31, 28, and 24 [3] - The projected revenue growth rates for 2025, 2026, and 2027 are 7.66%, 6.90%, and 5.52% respectively, indicating a steady growth trajectory [10] - The gross profit margin is expected to improve from 24.0% in 2025 to 26.0% by 2027 [12] Market Position and Outlook - The company is positioned as a leading player in the SMO sector, benefiting from a clear recovery in industry and client demand [3] - The report highlights the company's ongoing digital transformation and the development of proprietary management platforms that enhance operational efficiency [3]

Core Viewpoint - The company, Pursuit (Shanghai) Pharmaceutical Technology Development Co., Ltd., has shown a recovery in performance in the first half of 2025, driven by increased client demand and effective operational management measures, despite initial challenges in the first quarter [2][3]. Financial Performance - In the first half of 2025, the company achieved operating revenue of 390.10 million yuan and a net profit attributable to shareholders of 54.16 million yuan. The net profit after deducting non-recurring gains and losses was 38.54 million yuan [2]. - The second quarter saw a year-on-year revenue growth of 1.82% and a quarter-on-quarter growth of 21.06%. Net profit increased by 45.17% year-on-year and 528.73% quarter-on-quarter [2]. Order Growth and Strategy - The company signed new contracts worth 600 million yuan in the first half of 2025, a year-on-year increase of 40.12%, driven by the rising demand for SMO services from domestic and international pharmaceutical companies [3]. - The strategy focuses on maintaining a stable core customer base while enhancing engagement with smaller clients to ensure sustainable growth [3]. Industry Demand and Opportunities - The Chinese innovative drug industry is entering a new phase of high-quality development, with 72 overseas transactions amounting to 60 billion USD in the first half of 2025, benefiting the company through increased project and contract growth [4]. - The company is responding to industry changes by developing digital technologies and enhancing clinical trial management platforms, which improves execution efficiency and service quality [4]. Market Dynamics - The SMO industry in China is becoming more concentrated, with smaller firms gradually exiting the market. The company reported a 29.88% year-on-year increase in net cash flow from operating activities [5]. - The company has a high credit quality among clients, with a low proportion of bad debts, indicating improved collection status through better accounts receivable management [5].