Core Viewpoint - Kailaiying (06821) has seen a stock price increase of over 3%, currently at 85.8 HKD, with a trading volume of 13.68 million HKD. The company reported a revenue of 4.63 billion CNY for the first three quarters of 2025, reflecting an 11.82% year-on-year increase, and a net profit of 800 million CNY, up 12.66% year-on-year. The company anticipates a significant increase in delivery scale in Q4 compared to Q3, projecting an overall revenue growth of 13%-15% for the year [1][1][1]. Financial Performance - For the first three quarters of 2025, the company achieved a revenue of 4.63 billion CNY, which is an 11.82% increase year-on-year [1]. - The net profit attributable to shareholders was 800 million CNY, marking a 12.66% year-on-year increase [1]. - The basic earnings per share stood at 2.18 CNY [1]. Business Segments - The small molecule CDMO business, a cornerstone of Kailaiying, reported revenue that remained flat year-on-year, with a gross margin of 47.0%, down 1.9 percentage points [1]. - Emerging business segments showed strong growth, with a revenue increase of 71.9% year-on-year and a gross margin of 30.6%, up 10.6 percentage points [1]. - The revenue from the chemical macromolecule business grew by over 150% year-on-year [1]. Market Outlook - The company is actively expanding its market presence in emerging business areas such as peptides, oligonucleotides, and ADC, with new orders maintaining double-digit growth [1]. - The expansion of production capacity is expected to position emerging business segments as a core growth engine for the company [1].

Core Viewpoint - Kailaiying (002821) reported a revenue increase of 11.82% year-on-year for the first three quarters of 2025, reaching 4.63 billion yuan, with a net profit of 800 million yuan, reflecting a 12.66% increase [1] Financial Performance - For the first three quarters of 2025, the company achieved a revenue of 4.63 billion yuan, up 11.82% year-on-year [1] - The net profit attributable to shareholders was 800 million yuan, representing a 12.66% increase [1] - Basic earnings per share stood at 2.18 yuan [1] Future Outlook - The company anticipates that the delivery scale in the fourth quarter will significantly exceed that of the third quarter, projecting an annual revenue growth of 13%-15% [1] Business Segments - The small molecule CDMO business revenue remained stable year-on-year, with a gross margin of 47.0%, down 1.9 percentage points [1] - Emerging business segments showed strong growth, with a revenue increase of 71.9% year-on-year and a gross margin of 30.6%, up 10.6 percentage points [1] - The chemical macromolecule business saw revenue growth exceeding 150% year-on-year [1] Order Growth - The company is actively expanding its market presence in emerging business areas such as peptides, oligonucleotides, and ADC, maintaining double-digit growth in new orders [1] - Coupled with capacity expansion, emerging businesses are expected to become a core growth engine for the company [1]

Investment Rating - The investment rating for the company is "Outperform the Market" [5][3][20] Core Views - The company achieved steady growth in the first three quarters of 2025, with revenue reaching 4.63 billion yuan (+11.82%) and net profit attributable to shareholders at 800 million yuan (+12.66%) [1][6] - Emerging businesses are becoming the core growth engine, with a significant increase in revenue from new business areas, particularly in chemical macromolecules, which saw over 150% growth [2][3] - The company is expected to maintain rapid revenue growth throughout 2025, with projected revenues of 6.68 billion yuan, 7.53 billion yuan, and 8.29 billion yuan for 2025, 2026, and 2027 respectively, reflecting year-on-year growth rates of 15%, 13%, and 10% [3][4] Financial Performance Summary - For the first three quarters of 2025, the company reported quarterly revenues of 1.54 billion yuan, 1.65 billion yuan, and 1.44 billion yuan for Q1, Q2, and Q3 respectively, with Q2 showing the highest growth at +26.95% [1][6] - The operating cash flow improved to 1.144 billion yuan (+8.38%), indicating enhanced operational efficiency and effective cost control [2][12] - The gross margin for the small molecule CDMO business was 47.0% (-1.9pp), while the emerging business gross margin was 30.6% (+10.6pp) [2][3] Earnings Forecast - The company forecasts net profits of 1.14 billion yuan, 1.29 billion yuan, and 1.46 billion yuan for 2025, 2026, and 2027 respectively, with expected growth rates of 20%, 14%, and 14% [3][4] - The current price-to-earnings ratio (PE) is projected to be 29.8, 26.3, and 23.1 for the years 2025, 2026, and 2027 respectively [3][4]

Investment Rating - The report maintains an "Outperform" rating for the company, expecting a relative benchmark index increase of over 10% in the next 12-18 months [20]. Core Insights - The company has raised its full-year performance guidance, anticipating ongoing business revenue growth to shift from 13-17% to 17-18% [4][8]. - As of September 2025, the company's ongoing business orders reached RMB 59.88 billion, reflecting a year-on-year increase of 41.2% [4][8]. - Revenue forecasts for 2025-2027 are projected at RMB 44.02 billion, RMB 48.85 billion, and RMB 55.90 billion, with growth rates of 12.2%, 11.0%, and 14.0% respectively [4][8]. - Net profit attributable to shareholders is expected to be RMB 16.19 billion, RMB 14.68 billion, and RMB 16.88 billion for the same period, with growth rates of 71.3%, -9.3%, and 15.0% respectively [4][8]. - The company’s EPS is projected at RMB 5.42, RMB 4.92, and RMB 5.66 for 2025-2027 [4][8]. Financial Summary - The total revenue for 2023 is reported at RMB 40.34 billion, with a slight increase of 2.5% [3]. - The net profit for 2023 is RMB 9.61 billion, showing a growth of 9.0% [3]. - The company’s net asset return rate is expected to be 21.3% in 2025, with a PE ratio of 19.14 [3][4]. - The small molecule CDMO business reported revenue of RMB 14.24 billion in the first three quarters of 2025, a year-on-year increase of 14.1% [4][8]. - The TIDES business experienced significant growth, with revenue reaching RMB 7.84 billion, up 121.1% year-on-year [4][8]. Business Developments - The company has completed the capacity expansion for polypeptides, with solid-phase synthesis reactors exceeding 100,000L by September 2025 [4][8]. - An agreement was reached to sell 100% of its China clinical service research business for RMB 2.8 billion, while maintaining stable growth in its biological business [4][8]. - The laboratory analysis and testing revenue was RMB 2.96 billion, reflecting a 2.7% year-on-year increase [4][8].

Core Insights - The core business of the company is the chemical segment, which remains the main growth engine with a revenue increase of 29.3% year-on-year in the first three quarters [4][10] - The TIDES business (oligonucleotides and peptides) has shown exceptional performance, with revenue skyrocketing by 121.1% to 7.84 billion yuan [5][11] - The company has a robust order backlog of 59.88 billion yuan, reflecting a significant year-on-year growth of 41.2%, providing a solid foundation for upward adjustments in annual performance guidance [3][13] Financial Performance - In Q3 2025, the company achieved a revenue of 12.057 billion yuan, representing a year-on-year growth of 15.26% [3][8] - The net profit attributable to shareholders reached 3.515 billion yuan, with a substantial increase of 53.27% year-on-year [3][8] - For the first three quarters of 2025, total revenue was 32.857 billion yuan, up 18.61%, while net profit attributable to shareholders surged by 84.84% to 12.076 billion yuan [4][8] Business Segment Analysis - The TIDES business is the strongest growth driver, contributing 7.84 billion yuan in revenue, a remarkable increase of 121.1% [5][11] - The small molecule CDMO business maintained steady growth, generating 14.24 billion yuan in revenue, up 14.1% [12] - Testing services showed weak performance, with revenue of 4.17 billion yuan, nearly flat year-on-year, primarily due to a 6.4% decline in clinical CRO and SMO services [6][15] Market Dynamics - The company continues to rely significantly on overseas markets, with revenue from U.S. clients increasing by 31.9% to 22.15 billion yuan, while revenue from Chinese clients remained nearly unchanged, growing only 0.5% [13]

Core Insights - WuXi AppTec reported Q3 2025 revenue of 12.057 billion yuan, a year-on-year increase of 15.26%, with net profit attributable to shareholders reaching 3.515 billion yuan, up 53.27% [1] - The company’s chemical business remains the main growth driver, with a 29.3% year-on-year revenue increase in the first three quarters [2][5] - The TIDES business (oligonucleotides and peptides) showed exceptional performance, with revenue soaring 121.1% to 7.84 billion yuan [2][5] - The company’s backlog of orders reached 59.88 billion yuan, a significant year-on-year increase of 41.2%, providing a solid foundation for upward adjustments in annual performance guidance [6] Financial Performance - Q3 2025 revenue was 12.057 billion yuan, a 15.26% increase year-on-year; net profit attributable to shareholders was 3.515 billion yuan, up 53.27%; and non-GAAP net profit was 3.940 billion yuan, increasing by 73.75% [1] - For the first three quarters of 2025, total revenue was 32.857 billion yuan, a year-on-year increase of 18.61%; net profit attributable to shareholders was 12.076 billion yuan, up 84.84%; and non-GAAP net profit was 9.522 billion yuan, increasing by 42.51% [1] Business Segment Performance - The chemical business generated 25.98 billion yuan in revenue in the first three quarters, reflecting a 29.3% year-on-year growth [2][5] - The TIDES business achieved revenue of 7.84 billion yuan, marking a remarkable 121.1% increase [2][5] - The small molecule CDMO (D&M) business reported revenue of 14.24 billion yuan, a 14.1% year-on-year growth [3][5] - The testing business showed stagnant performance with revenue of 4.17 billion yuan, nearly unchanged at -0.04% year-on-year, primarily due to a 6.4% decline in clinical CRO and SMO business [3][7] - The biological business experienced a slowdown, with revenue of 1.95 billion yuan, reflecting a 6.6% year-on-year growth [4][7] Market Dynamics - The company continues to rely significantly on overseas markets, with revenue from U.S. clients increasing by 31.9% to 22.15 billion yuan, while revenue from Chinese clients remained flat, growing only 0.5% [7] - The substantial backlog of orders indicates high revenue growth certainty for the upcoming quarters [6]

Core Insights - The company achieved revenue of 3.188 billion yuan in H1 2025, representing an 18.2% increase, and a net profit attributable to shareholders of 617 million yuan, up 23.7% [1] - The company’s overseas revenue showed robust growth, particularly in Europe, where revenue reached 548 million yuan, growing over 200% year-on-year, accounting for 17% of total revenue [2] - The company’s emerging business segment is entering a high-growth phase, with revenue from chemical macromolecules expected to double for the full year [4] Financial Performance - In H1 2025, the company reported a gross margin of 43.5%, an increase of 1.3 percentage points, and an adjusted net profit margin of 21.4%, up 5.4 percentage points [2] - The company’s revenue for Q2 alone was 1.647 billion yuan, reflecting a 26.94% increase, with a net profit of 291 million yuan, up 33.94% [1] - The company has a strong order backlog of 1.088 billion USD, indicating high revenue certainty for the full year, with expected revenue growth of 13-15% [2] Business Segments - The small molecule CDMO business generated revenue of 2.429 billion yuan in H1 2025, showing a steady growth of 10.6% [3] - The emerging business segment reported revenue of 756 million yuan, a significant increase of 51.2%, with a backlog growth of over 40% [4] - The chemical macromolecule business saw revenue of 379 million yuan, growing over 130%, with expectations for continued strong growth in the second half of the year [4] Future Outlook - The company anticipates revenue for 2025-2027 to be 6.755 billion, 8.066 billion, and 9.488 billion yuan, with year-on-year growth rates of 16.37%, 19.40%, and 17.63% respectively [4] - Net profit projections for the same period are 1.155 billion, 1.377 billion, and 1.668 billion yuan, with growth rates of 21.70%, 19.24%, and 21.11% respectively [4]

Core Viewpoint - Kailaiying Pharmaceutical Group (Tianjin) Co., Ltd. has demonstrated strong growth and potential in the industry, as revealed during recent institutional research activities [1] Financial Overview - For the reporting period, the company achieved revenue of 3.188 billion yuan and a net profit attributable to shareholders of 617 million yuan, with a backlog of orders amounting to 1.088 billion USD [2] - Revenue increased by 18.2% year-on-year, while net profit grew by 23.7% [2] - Gross margin stood at 43.5%, up by 1.3 percentage points, and net profit margin was 19.4%, an increase of 0.9 percentage points [2] - Adjusted net profit margin reached 21.4%, reflecting a year-on-year increase of 5.4 percentage points [2] Business Segment Highlights - Small Molecule CDMO business generated revenue of 2.429 billion yuan, a 10.6% increase year-on-year, with a gross margin of 29.8%, up by 9.5 percentage points [3] - Emerging businesses, including peptides and small nucleic acids, saw revenue of 756 million yuan, representing a 51.2% year-on-year growth [3] - The company expanded its global market presence, adding over 150 new CDMO business clients during the reporting period [2] - Revenue from multinational pharmaceutical companies grew by 14.7%, while overseas revenue increased by 23.3% [2] - Revenue from small and medium-sized pharmaceutical companies rose by 21.6%, with domestic revenue up by 3.4% [2] Operational Developments - The small molecule business maintained steady growth despite industry challenges, with significant advancements in overseas capacity construction [3] - The company completed the delivery of 4 R&D projects and 1 production order for MNC clients, along with 285 QA audits [3] - The emerging business segment has a backlog of orders that increased by over 90% year-on-year, with over 40% from overseas [3] - The domestic market saw the approval of its first commercial peptide project in the weight loss sector [3] Future Outlook - For the first half of 2025, the company expects a revenue growth of 13% to 15% [4] - The company plans to enhance cost reduction and efficiency measures while increasing market expansion efforts, particularly in peptides, oligonucleotides, and conjugated drugs [4]

Financial Overview - Revenue for H1 2025 reached 3,188 million RMB, an increase from 2,697 million RMB in H1 2024 [80] - Adjusted net profit for H1 2025 was 617 million RMB, up from 499 million RMB in H1 2024 [80] - Gross profit margin improved to 43.5%, up from 42.2% in H1 2024 [64] Performance Highlights - Gross margin increased by 1.3 percentage points to 43.5% [13] - Net profit growth outpaced revenue growth by 5.5 percentage points [14] - The company reported a backlog of orders worth 10.88 billion USD, with a year-on-year increase of over 40% [13] Segment Performance Small Molecule Business - Revenue for small molecule CDMO business was 24.29 billion RMB, a 10.6% increase year-on-year [20] - Gross margin for small molecule business reached 47.8%, up 0.6 percentage points [32] Emerging Business - Emerging business revenue surged by 51.2% to 7.56 billion RMB [19] - Gross margin for emerging business was 29.8%, an increase of 9.5 percentage points [20] Clinical CRO Business - Revenue for clinical CRO business was 1.39 billion RMB, reflecting a growth of 44.8% [42] - The company supported 13 projects to obtain clinical trial approvals in China [42] Market Expansion - The company added over 150 new CDMO business clients during the reporting period [22] - Revenue from the US market was 1.789 billion RMB, a slight increase of 0.5% year-on-year [25] - Revenue from the European market grew by over 200% to 548 million RMB [25] Future Outlook - The company anticipates a revenue growth of 13% to 15% for the full year of 2025 [77] - Plans to enhance operational efficiency and profitability, aiming for profit growth to exceed revenue growth [77] - Continued focus on expanding capabilities in peptide, oligonucleotide, and conjugated drug segments [77]

Core Insights - Kailaiying (002821) reported a revenue of 3.188 billion RMB for the six months ending June 30, 2025, representing a year-on-year growth of 20.08% [1] - The net profit attributable to shareholders was 617 million RMB, an increase of 23.71% year-on-year, with basic earnings per share at 1.68 RMB [1] - The gross margin for the first half of 2025 was 43.26%, up by 2.03 percentage points compared to the same period last year [1] Revenue Breakdown - The small molecule CDMO business generated revenue of 2.429 billion RMB, reflecting a year-on-year growth of 12.80% [1] - The emerging business segment achieved revenue of 756 million RMB, marking a significant increase of 51.32% year-on-year [1] Operational Performance - Despite the ongoing global downturn in biopharmaceutical financing, the company demonstrated organic revenue growth and positive trends, highlighting its operational strength and solid global customer base [1] - The implementation of cost reduction and efficiency enhancement measures, along with increased delivery scale and capacity utilization in emerging businesses, contributed to a net profit growth that outpaced revenue growth by 3.63 percentage points [1]