According to a research report released by UBS Group, WuXi AppTec (02359) was given a 'neutral' rating, and the rapid growth of accumulated orders and new molecule (TIDES) businesses are positive factors, despite the declining revenue ratio of the USA business. The market focus is expected to be on the progress of the Biosecurity Act and the sentiment of global customers, with a target price of HKD 40.1.
The report mentions that WuXi AppTec's revenue in the first half of the year fell 8.6% year-on-year to RMB 17.2 billion, and net income attributable to shareholders fell 20.2% to RMB 4.2 billion, both of which were lower than expected by the bank. The company maintains its full-year revenue guidance of RMB 38.3 billion to RMB 40.5 billion, excluding the revenue from the pandemic, which increased by 2.7% year-on-year to 8.6%. The Non-IFRS net profit margin is maintained at the 2023 level. The capital expenditures for this year remain at RMB 5 billion, and capital expenditures for development and manufacturing (D&M) are expected to increase by 50% year-on-year in 2025.
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