Core Viewpoint - Shanghai Haoyuan Pharmaceutical Co., Ltd. received an inquiry letter from the Shanghai Stock Exchange regarding its 2024 annual report, prompting a detailed response about its business operations and financial performance. Group 1: Main Business Operations - The company reported a total revenue of 2,253.67 million yuan from its research and experimental development sector in 2024, with a year-on-year growth of 32.41% in the front-end molecular building blocks and tool compounds business, generating 1,499.07 million yuan [1][4] - The product sales revenue in this segment was 1,363.90 million yuan, reflecting a 36.01% increase, while the gross profit margin stood at 63.74% [1][4] - The back-end raw materials and intermediates development business generated 754.61 million yuan, with a modest year-on-year growth of 2.49%, but product sales in this segment saw a decline of 30.45% [1][4] Group 2: Revenue and Profitability Analysis - Domestic and overseas business revenues were 1,391.69 million yuan and 861.99 million yuan respectively, with gross profit margins of 38.82% and 46.8% [1][4] - The company provided a detailed breakdown of its four business segments, including revenue, gross profit margins, and year-on-year changes, indicating a comprehensive analysis of market size and competitive landscape [1][4][6] Group 3: Market Trends and Growth Potential - The global pharmaceutical R&D expenditure is projected to grow at a rate of 4.2% annually, reaching 254 billion USD by 2026, which is expected to positively impact the life sciences reagent market [6][7] - The Chinese research reagent market has expanded from approximately 25 billion yuan in 2018 to about 48 billion yuan in 2022, with a compound annual growth rate of around 18% [6][7] - The global CDMO market is also on a growth trajectory, with expectations to reach 124.3 billion USD by 2025, indicating a robust demand for innovative drug development services [9][10] Group 4: Competitive Positioning - The company has established itself as a competitive player in the life sciences reagent sector, particularly in the molecular building blocks and tool compounds market, which is characterized by strong customization capabilities and a growing customer base [2][4] - The company’s tool compounds business is positioned favorably compared to peers, with higher revenue growth and gross profit margins, reflecting its strong international influence [11][12] - The company’s performance in the generic drug intermediates and raw materials sector aligns with industry trends, with a notable increase in the market for high-end pharmaceutical intermediates [13][14]