In today’s briefing:
- China Healthcare Weekly (Dec.15)-BMS/Biokin $8.4B Eye-Popping Deal, NRDL Negotiation Result, Haoyuan
- [KE Holdings Inc. (BEKE US, BUY, TP US$24.5) TP Change]: Policy Stimulus Drive up near Term Sales
- Taiwan Tech Weekly: AI Plays Weak Despite Strong Taiwan Tech Market Performance
- Interglobe Aviation (INDIGO IN | SELL | TP: INR2,513): Not Worth a King’s Ransom
- Boryung Pharmaceutical (003850 KS): Prescription Drugs Took a Breather in Q3; Poised to Rebound
China Healthcare Weekly (Dec.15)-BMS/Biokin $8.4B Eye-Popping Deal, NRDL Negotiation Result, Haoyuan
- 2023 NRDL negotiation results were released. We’re seeing the rules of NRDL renewal negotiations tilt toward innovative drugs, leading to lower price reduction, but there has been no fundamental change.
- The record-breaking US$8.4 billion deal involving BMS and Sichuan Biokin Pharmaceutical (688506 CH) (SystImmune) is not without risk, though. We still recommend to remain rational.
- The issue facing Shanghai Haoyuan Chemexpress (688131 CH) is higher revenue but lower margins. Valuation will likely experience further declines due to lock-up expiry and share reduction.
[KE Holdings Inc. (BEKE US, BUY, TP US$24.5) TP Change]: Policy Stimulus Drive up near Term Sales
- Beijing and Shanghai laid out long waited stimulus policies on property market, include 1) lower property down payments ratio;2) lower mortgage loan rate;
- 3) lower recognition standard for ordinary home. The key is to encourage households to add leverage.
- We treat the financial stimulus as one-off positive shock to the home transaction markets in the two cities, especially benefiting 1Q24 sales for Beike due to…
Taiwan Tech Weekly: AI Plays Weak Despite Strong Taiwan Tech Market Performance
- Overall, it was a strong week for Taiwan Tech. TSMC and Mediatek showed strong performances, as well as key names we like such as Yageo and Himax.
- AI-Related Taiwan plays showed relative weakness. This weakness interestingly happened during a week when NVIDIA Corp (NVDA US) performed well.
- According to insight provider Patrick Liao, MediaTek WiFi 7 chip competition is likely to become fierce in 2024.
Interglobe Aviation (INDIGO IN | SELL | TP: INR2,513): Not Worth a King’s Ransom
- InterGlobe Aviation Ltd (INDIGO IN) (Indigo) has turnaround and is on path to achieve record profits in FY2024 on strong demand, stable FX and lower jet fuel prices
- However, engine problems will hurt capacity deployment in 4QFY24 and FY2025, and the engine manufacturer has been very vague and unreliable in presenting its remedial plans
- Share price near all-time high and valuations (PE, EV/EBITDAR) are expensive compared to global LCCs. TP of INR2,513 (14% DOWNSIDE) pegged to 15x FY2025 PE (top-end LCC cycle)
Boryung Pharmaceutical (003850 KS): Prescription Drugs Took a Breather in Q3; Poised to Rebound
- In 3Q23, Boryung Pharmaceutical (003850 KS) reported 15% YoY growth in revenue to KRW208B, driven by 7% YoY growth in prescription drugs, the slowest growth in the last three years.
- Prescription drug revenue growth slowed due to the huge shortfall in revenue from the diabetes drug Trulicity caused by supply shortage. We expect slowdown in Trulicity revenue is temporary.
- Despite losing patent protection in February 2023 on ARB monotherapy, Kanarb drug family is showing no fatigue due to increasing preference for combination drugs in the market.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
