Core Viewpoint - Shengxiang Biology (688289) reported a revenue increase of 21.15% year-on-year for the first half of 2025, reaching 869 million yuan, while net profit rose by 3.84% to 163 million yuan. However, the second quarter saw a decline in net profit by 6.21% compared to the previous year [1]. Financial Performance - Total revenue for the first half of 2025 was 869 million yuan, up from 717 million yuan in 2024, marking a 21.15% increase [1]. - Net profit attributable to shareholders reached 163 million yuan, compared to 157 million yuan in 2024, reflecting a 3.84% increase [1]. - The gross profit margin decreased to 73.28%, down 5.15% year-on-year, while the net profit margin fell to 16.43%, a decline of 13.15% [1]. - Total expenses (selling, administrative, and financial) amounted to 347 million yuan, accounting for 39.94% of revenue, a decrease of 5.03% year-on-year [1]. - Earnings per share increased to 0.28 yuan, up 3.7% from 0.27 yuan in 2024 [1]. Accounts Receivable and Cash Flow - Accounts receivable reached 762 million yuan, representing a 14.24% increase from 667 million yuan in 2024, with accounts receivable to net profit ratio at 276.45% [1][6]. - Operating cash flow per share was -0.25 yuan, a significant decrease of 131.01% year-on-year [1]. Changes in Financial Items - Significant changes in financial items included a 43.93% increase in accounts receivable due to credit term adjustments and the impact of newly consolidated companies [2]. - The company experienced a 780.91% increase in short-term borrowings, attributed to the need for additional working capital loans [3]. - The net cash flow from operating activities decreased by 127.45%, primarily due to reduced government subsidies and tax refunds compared to the previous period [4]. Investment and Market Position - The company has a healthy cash asset position, indicating strong solvency [5]. - The business model relies heavily on research and marketing efforts, necessitating further investigation into the underlying drivers of these efforts [5]. - Analysts expect the company's performance in 2025 to reach 307 million yuan, with an average earnings per share forecast of 0.53 yuan [6]. Fund Holdings - The largest fund holding Shengxiang Biology is Huatai-PB Medical Health A, with a current scale of 241 million yuan and a recent net value increase of 3.52% [7].

Investment Rating - The investment rating for the company is a specialized IPO score of "5.3" [7][9]. Core Insights - The company, Weisheng Pharmaceutical-B (2561.HK), is a late-stage biopharmaceutical firm focused on providing treatment solutions for specific endocrine diseases in China, including Hong Kong, Macau, and Taiwan. It has one core product and two other candidate drugs in development, all licensed from its partner and major shareholder, Ascendis Pharma [1]. - The Chinese growth hormone market is experiencing significant growth, with a market size increasing from 4 billion yuan in 2018 to 11.6 billion yuan in 2023, representing a compound annual growth rate (CAGR) of 23.9%. It is expected to reach 28.6 billion yuan by 2030, with a projected CAGR of 13.7% from 2023 to 2030 [3]. - The company has a highly certain pipeline nearing commercialization, with its core product, Longpei Growth Hormone, being a long-acting growth hormone replacement therapy for PGHD, which has already received acceptance for BLA submission by the National Medical Products Administration [4]. Financial Status - As of now, the company has no commercialized products and has not achieved profitability. The other income for the years 2022, 2023, and up to September 30, 2024, was 5.764 million yuan, 11.356 million yuan, and 8.647 million yuan, respectively, with total losses of 290 million yuan, 250 million yuan, and 130 million yuan for the same periods [2]. Industry Status and Outlook - The growth in the demand for growth hormone treatments, the continuous emergence of treatment solutions, and the increasing awareness of growth hormone deficiency among patients are the main drivers for future industry growth [3]. Competitive Advantages - The company possesses a pipeline based on proven technologies, with a high degree of certainty in approaching revenue generation. The management team is highly capable of commercialization and has strong support from shareholders and investors [4]. Use of Proceeds from IPO - Approximately 84.0% of the proceeds will be used for the ongoing BLA registration of the core product and the planned commercialization of Longpei Growth Hormone. About 7.6% will fund the ongoing Phase 3 pivotal trial of Parolepitide in China, while 1.8% will support the ongoing Phase 2 trial of Navepitide for treating achondroplasia. The remaining 6.6% will be allocated for working capital and general corporate purposes [5].