Investment Rating - The report initiates coverage with a "Buy" rating for Chengdu XianDao (688222) [7] Core Insights - Chengdu XianDao focuses on the discovery and optimization of small molecule and nucleic acid new drugs, leveraging four core technology platforms: DEL, FBDD/SBDD, OBT, and TPD, to establish an internationally leading R&D system for new drug discovery and optimization [1][16] - The company is a leader in DEL technology, possessing the largest known library of small molecule compounds globally, and has formed a DEL alliance with major international pharmaceutical companies, enhancing its technical leadership [2][4] - The integration of DEL and AI technologies, along with the completion of high-throughput infrastructure, positions the HAILO platform to significantly expand the chemical space for molecule screening [3][4] Summary by Sections 1. Diversified Platform Development - Chengdu XianDao is an international high-tech innovative drug R&D company with subsidiaries in Cambridge, UK, and Houston, USA, focusing on small molecule and nucleic acid drug discovery [16] - The company achieved a revenue of 227.01 million yuan in the first half of 2025, representing a year-on-year growth of 16.58%, with a net profit of 50.04 million yuan, up 390.72% [20][22] 2. New Drug Development Trends - The report highlights a resurgence in new drug development, with a significant increase in the number of new chemical entities approved by the FDA, indicating a recovery in both global and domestic new drug R&D [30][34] - In the first half of 2025, the company’s DEL segment generated revenue of 102.19 million yuan, a 40.45% increase year-on-year, driven by flexible and diversified custom library and screening services [22] 3. Financial Forecast - The company is projected to achieve revenues of 504 million yuan, 608 million yuan, and 739 million yuan for the years 2025, 2026, and 2027, respectively, with year-on-year growth rates of 17.95%, 20.70%, and 21.57% [5] - The net profit attributable to shareholders is expected to be 81 million yuan, 122 million yuan, and 156 million yuan for the same years [5]