Investment Rating - The report maintains a "Buy" rating for the company with a target price of 47.33 RMB [7][5]. Core Views - The company reported a revenue of 570 million RMB for the first half of 2025, a decrease of 5% year-on-year, while the net profit attributable to the parent company was 50 million RMB, an increase of 12% year-on-year. The second quarter revenue was 330 million RMB, down 13% year-on-year, with a net profit of 20 million RMB, up 7% year-on-year. The company is expected to receive approval for its long-acting interferon product, Paiyisheng, within 2025, which is anticipated to strengthen its position in the domestic hepatitis market [1][5]. Summary by Sections Financial Performance - The company achieved a revenue of 570 million RMB in H1 2025, down 5% year-on-year, and a net profit of 50 million RMB, up 12% year-on-year. In Q2 2025, revenue was 330 million RMB, down 13% year-on-year, with a net profit of 20 million RMB, up 7% year-on-year [1]. Product Development - The company is focusing on functional cures for hepatitis B, with KW-040 approved for clinical trials in July 2025. The long-acting interferon has a new indication for adult chronic hepatitis B, which is expected to be approved within 2025 and enter the medical insurance negotiation in 2026 [3][4]. Research and Development - The company increased its R&D investment to 71.41 million RMB in H1 2025, accounting for 12.6% of revenue, up 0.8 percentage points year-on-year. The company is also expanding its product pipeline in the field of immune diseases [4]. Profit Forecast Adjustments - The profit forecast for 2025-2027 has been adjusted, with expected revenues of 1.28 billion RMB, 1.50 billion RMB, and 1.69 billion RMB, representing a decrease of 7%, 7%, and 8% from previous estimates. The net profits are expected to be 170 million RMB, 210 million RMB, and 240 million RMB, with adjustments of -1%, -1%, and -9% respectively [12][5]. Valuation - Using the SOTP valuation method, the company's reasonable valuation is estimated at 8.09 billion RMB, with a target price of 47.33 RMB per share [13][5].

Core Viewpoint - The company, Kaiyin Technology, is actively advancing its drug development projects and has reported positive financial performance in Q1 2025, indicating growth potential in the biopharmaceutical sector focused on viral and immune diseases [6][8]. Group 1: Drug Development Progress - The company has received acceptance for its new drug application for chronic hepatitis B treatment by the National Medical Products Administration in September 2024, with further updates to be provided by regulatory announcements [2]. - In 2025, the company plans to accelerate the clinical progress of several projects, including KW-051 for shingles, KW-045 for herpetic pharyngitis, and KW-053 for genital warts, while also focusing on the Phase I clinical study of a new drug KW-040 [3]. - The company is concentrating on innovative drug development for functional cure of hepatitis B, with ongoing clinical trials for KW-001 and KW-027, and has submitted a clinical trial application for KW-040 [6]. Group 2: Market Position and Competition - The domestic hepatitis C market presents significant growth opportunities, with the company’s product, Kailiwei, expected to leverage its competitive advantages in product strength and promotional strategies to achieve breakthroughs [4]. - The company is enhancing the brand influence of its product Jinshuxi, which has been included in the Jiangxi centralized procurement, aiming for increased market share through strategic channel optimization and cancer screening initiatives [5]. Group 3: Financial Performance - In Q1 2025, the company reported a main revenue of 232 million yuan, an increase of 8.9% year-on-year, and a net profit of approximately 25.67 million yuan, reflecting a 15.92% year-on-year growth [6]. - The company’s gross profit margin stands at 82.95%, with a debt ratio of 24.29%, indicating a strong financial position [6]. - Recent institutional ratings show 5 buy ratings and 2 hold ratings, with an average target price of 44.97 yuan over the past 90 days [6][8].