External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>We expect WuXi Bio’s revenue to grow by 11% YoY in 1H23E and attributable adjusted net income to stay flat in 1H23E, mainly due to the relatively high base in 1H22 and the reduced revenue from COVID-related projects.</li><li>In 5M23, the Company added 25 new projects into its pipeline, including 8 external projects under its “Win-the-Molecule” strategy. Despite the sizable capacity additions in 2022 (i.e., MFG7 in Ireland and MFG8 in Shijiazhuang, each with a capacity of 48k L), we forecast WuXi Bio to maintain a satisfying margin level thanks to effective cost controls through the continuous execution of WBS (WuXi Biologics Business System) which targets to improve gross profit margin (GMP) by 300bps in 2023.</li><li>WuXi Bio management maintained its full-year guidance unchanged with revenue growth of 30% YoY and attributable adjusted net income of 26% YoY for 2023E. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We expect WuXi Bio’s revenue to grow by 11% YoY in 1H23E and attributable adjusted net income to stay flat in 1H23E, mainly due to the relatively high base in 1H22 and the reduced revenue from COVID-related projects.In 5M23, the Company added 25 new projects into its pipeline, including 8 external projects under its “Win-the-Molecule” strategy. Despite the sizable capacity additions in 2022 (i.e., MFG7 in Ireland and MFG8 in Shijiazhuang, each with a capacity of 48k L), we forecast WuXi Bio to maintain a satisfying margin level thanks to effective cost controls through the continuous execution of WBS (WuXi Biologics Business System) which targets to improve gross profit margin (GMP) by 300bps in 2023.WuXi Bio management maintained its full-year guidance unchanged with revenue growth of 30% YoY and attributable adjusted net income of 26% YoY for 2023E. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi Biologics (2269 HK) – 2023E growth outlook remains intact

<ul><li>WuXi Bio reported 2022 revenue of RMB15.3bn, up 48.4% YoY, and attributable adjusted net income of RMB4.9bn, up 48.5% YoY.</li><li>Non-COVID revenue grew by 62.8% YoY to RMB12.0bn, accounting for 78.5% of total revenue in 2022.</li><li>Adjusted gross profit margin was maintained at a stable level of 50.0% in 2022, vs 50.6% in 2021, despite the newly-operational capacity during 2022, indicating a high utilization of existing facilities, successful integration of acquired facilities, efficient ramp-up of new capacities and efficiency improvement from the deployment of WBS (WuXi Biologics Business System).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi Bio reported 2022 revenue of RMB15.3bn, up 48.4% YoY, and attributable adjusted net income of RMB4.9bn, up 48.5% YoY.Non-COVID revenue grew by 62.8% YoY to RMB12.0bn, accounting for 78.5% of total revenue in 2022.Adjusted gross profit margin was maintained at a stable level of 50.0% in 2022, vs 50.6% in 2021, despite the newly-operational capacity during 2022, indicating a high utilization of existing facilities, successful integration of acquired facilities, efficient ramp-up of new capacities and efficiency improvement from the deployment of WBS (WuXi Biologics Business System).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi Biologics (2269 HK) – Stronger competency for a brighter future

<ul><li>WuXi Bio previously released a positive profit alert for 2022 earnings, expecting revenue to grow ~48.4% YoY, attributable net profit to grow ~30% YoY and adjusted non-IFRS net profit to grow 47% YoY.</li><li>Excluding ~RMB3bn COVID revenue, we expect non-COVID revenue to grow by ~68.3% YoY in 2022.</li><li>The Company has well executed on its capacity expansion plan by bringing Ireland and Shijiazhuang sites online in 4Q22. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi Bio previously released a positive profit alert for 2022 earnings, expecting revenue to grow ~48.4% YoY, attributable net profit to grow ~30% YoY and adjusted non-IFRS net profit to grow 47% YoY.Excluding ~RMB3bn COVID revenue, we expect non-COVID revenue to grow by ~68.3% YoY in 2022.The Company has well executed on its capacity expansion plan by bringing Ireland and Shijiazhuang sites online in 4Q22. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi Biologics (2269 HK) – Strong and sustainable non-COVID growth

Thematic (Sector/Industry)

<ul><li>In our last report dated 17 October, we highlighted a list of 21 long ideas.</li><li>The basket (equal weighted) of these 21 stocks underperformed MSCI China index by 5.4ppt, delivering 0.2% return (vs MSCI China 5.6%).</li><li>China Meidong Auto and Innovent Biologics delivered over 20% of return, and 4 of our 21 long ideas outperformed the benchmark.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

In our last report dated 17 October, we highlighted a list of 21 long ideas.The basket (equal weighted) of these 21 stocks underperformed MSCI China index by 5.4ppt, delivering 0.2% return (vs MSCI China 5.6%).China Meidong Auto and Innovent Biologics delivered over 20% of return, and 4 of our 21 long ideas outperformed the benchmark.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

CMBI Research Focus List (November Edition) – Our best high conviction stock ideas

Research from Quam Securities, Quam Securities

Quam Securities Research

Research from Quam Securities

Quam Securities

Since its inception in 1986, Quam Securities Limited (Quam Securities) has grown to become one of the few mid-tier securities brokerages in Hong Kong with global execution capabilities for both private and institutional clients. It boasts a well-established network in Greater China including Taiwan and in major world markets through the Global Alliance Partners (GAP). Quam Securities is well-positioned not only to harness and drive business within the China Tonghai International Financial Limited but also between China and the world markets.

<ul type="square"><li>The U.S. launched new support to its biotech production, aiming to boost biomanufacturing in pharmaceuticals but also in other industries such as agriculture, plastics, and energy.</li><li>The executive order would contain a plan for mass investments in related industries.</li><li>Shares of Wuxi Biologics (2269 HK, NR) and other CRO companies fell significantly yesterday (13 Sept) due to the fears of Chinese companies being targeted.</li></ul>

The U.S. launched new support to its biotech production, aiming to boost biomanufacturing in pharmaceuticals but also in other industries such as agriculture, plastics, and energy.The executive order would contain a plan for mass investments in related industries.Shares of Wuxi Biologics (2269 HK, NR) and other CRO companies fell significantly yesterday (13 Sept) due to the fears of Chinese companies being targeted.

The U.S. Executive Order on Its Biotech Industry May Not Materiality Affect Chinese CRO Industry

China

WuXi Biologics (Cayman) Inc. is a leading open-access R&D capability and technology platform company serving the pharmaceutical, biotechnology, and medical device industries, with operations in China, U.S., and Iceland.  We provide a broad and integrated portfolio of laboratory and manufacturing services throughout the drug and medical device R&D process.  Our services are designed to help our global partners in shortening the cycle and lowering the cost of drug and medical device R&D through cost-effective and efficient solutions. 

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Wuxi Biologics (2269 HK)