Core Insights - The "World Fusion Energy Group" held its second ministerial meeting and the 30th International Conference on Fusion Energy in Chengdu, where Sichuan province announced 24 policy measures to promote the high-quality development of the nuclear medicine industry [1][12] - Chengdu is positioning itself as a leader in the nuclear medicine sector, focusing on the entire industry chain from the production of medical isotopes to the development of radiopharmaceuticals and manufacturing of nuclear medical equipment [3][6] Policy Measures - Sichuan's new policies aim to support precise targeting, industrial upgrades, expanding application demands, and creating a favorable development environment [1] - The release of an opportunity list in the nuclear medicine sector highlights Chengdu's commitment to developing three nuclear drug bases [1] Industry Developments - Chengdu's nuclear medicine sector has seen significant advancements, including the clinical approval of innovative nuclear drugs and substantial financing for nuclear medicine companies [3][4][12] - The establishment of the Fosun Pharma nuclear drug platform in Chengdu marks a strategic move to enhance research and development in the nuclear medicine field [9][10] Innovation and Breakthroughs - Chengdu's Baile Tianheng received approval for its first antibody-radiolabeled drug, which is expected to significantly improve treatment for advanced or metastatic solid tumors [4] - The successful development and export of a domestically produced germanium-gallium generator by Chengdu's Nureter Medical Technology represents a breakthrough in the self-sufficiency of medical isotopes [5] Ecosystem and Collaboration - Chengdu is fostering a collaborative ecosystem that integrates policy support, capital investment, talent attraction, and industry-academia cooperation to enhance the nuclear medicine industry [12][13] - The establishment of specialized parks and research centers in Chengdu is aimed at creating a comprehensive support system for nuclear medicine innovation [11][14]

Investment Rating - The report initiates coverage with a "Buy" rating for Grand Pharmaceutical (0512.HK) [7]. Core Views - Grand Pharmaceutical is positioned as a leading player in the nuclear medicine and high-end formulation sectors, with a comprehensive pipeline and a focus on innovative drug development. The company is expected to achieve significant growth driven by its nuclear medicine products and a robust traditional pharmaceutical segment [6][7]. Summary by Sections 1. Innovation Leading Nuclear Medicine Development - The company has established a comprehensive industrial chain covering research, production, and commercialization in nuclear medicine and precision intervention fields [11]. - Grand Pharmaceutical's core product, Yttrium-90 microsphere injection (易甘泰®), is the first approved nuclear medicine for liver cancer treatment in China, with a significant market presence [11][14]. - The nuclear medicine segment is expected to grow rapidly, with projected sales of 500 million HKD in 2024, reflecting a year-on-year increase of 140% [6]. 2. Nuclear Medicine Pipeline Entering Harvest Phase - The global nuclear medicine market is projected to grow at a compound annual growth rate (CAGR) of 16.4%, reaching 21.9 billion USD by 2029 [6][25]. - The company has a rich pipeline with 12 clinical candidates, including four in Phase III trials, targeting various cancers such as prostate and kidney cancer [6][11]. - The report highlights the potential of STC3141, a novel treatment for sepsis, which has shown significant efficacy in clinical trials [6][7]. 3. Financial Performance and Forecast - The company achieved a revenue of 61.1 billion HKD in the first half of 2025, with a year-on-year growth of 1.0%, while the net profit was 11.7 billion HKD, down 26.1% year-on-year [14][18]. - The report forecasts net profits of 20.21 billion HKD, 23.47 billion HKD, and 27.56 billion HKD for 2025, 2026, and 2027, respectively, with corresponding price-to-earnings (P/E) ratios of 17, 14, and 12 [7][14]. - The traditional pharmaceutical segment remains stable, contributing 63% of total revenue, with key products in respiratory and critical care showing solid growth [18][20]. 4. Competitive Positioning - Grand Pharmaceutical's valuation is attractive, with a 2025 P/E ratio of 17, lower than the average of comparable companies at 22 [7]. - The company has established a global sales network covering over 50 countries, demonstrating its international competitiveness [22][24]. - The report emphasizes the strategic acquisitions and partnerships that have strengthened the company's market position and product offerings [11][22].