Jinwu Financial News | According to the UBS Research Report, the management of Alibaba Health (00241) stated that it reiterated the target revenue increase of 10% or more for the 2025 fiscal year, and adjusted net profit of more than 2 billion yuan; the target revenue for the 2026 fiscal year also increased by 10% or more, and adjusted net profit of 2.3 billion yuan to 2.5 billion yuan. Starting in the second half of fiscal year 2025, revenue growth will be driven by the accelerated growth of prescription drugs and the continued growth of non-prescription drugs. The bank believes that the company's renewed emphasis on prescription drugs reflects the pursuit of market share, or is a condition for maintaining the current level of gross margin.
Based on weak consumption, the bank lowered its revenue forecast for non-prescription drugs, but slightly raised its revenue growth forecast for prescription drugs to reflect the company's strategy adjustments. Currently, it is predicted that Alibaba Health's revenue will increase by 10.5%, 9.1%, and 10.2% for the 2025, 26th, and 27th fiscal years, respectively. Net profit forecasts for the same period were lowered due to assumptions of lower gross margin and higher sales expenses due to diluted sales of prescription drugs. The bank raised the company's target price by 13.6% from HK$3.3 to HK$3.75, reflecting stronger expectations that prescription drugs will drive revenue growth in the medium term. The new target price also reflects that the company's price-earnings ratio is higher than that of Internet stocks and pharmaceutical peers, adjusted to reflect a faster expected profit growth rate. Rating “neutral”.
