药明康德(603259) 　　WuXi AppTec reported 1H24 revenue of RMB17.24bn, down 8.6% YoY,attributable recurring net profit of RMB4.41bn, down 8.3% YoY, and attributableadjusted non-IFRS net profit of RMB4.37bn, down 14.2% YoY. 1H24 revenue /attributable adjusted non-IFRS net income accounted for 45.3%/ 46.0% of our2024 full-year estimates and 43.8%/ 44.7% of Bloomberg consensus, both ofwhich were largely in line with its historical range. The non-COVID D&M revenue(within the Chemistry segment) experienced a slight decline of 2.7% YoY in1H24, following a relatively high base in 1H23. Notably, WuXi AppTec’s backlog,excluding COVID-19 commercial projects, increased by 33.2% YoY in 1H24,indicating strong customer demand amid geopolitical uncertainties. Mgt. hasreiterated its revenue guidance of RMB38.3-40.5bn for 2024, forecasting YoYgrowth of 2.7% to 8.6% for revenues excluding COVID-19 commercial projects.Mgt. expects the adjusted non-IFRS net profit margin to align with the 2023level. 　　Impressive order growth driven by solid demand. As of June 2024, WuXiAppTec's backlog reached RMB43.1bn, marking a robust YoY increase of33.2% excluding COVID-19 commercial projects. Revenue from its globalTop20 pharmaceutical clients reached RMB6.59bn, contributing 38.2% ofthe total revenue and increasing by 11.9% YoY excluding COVID-19commercial projects. Mgt. highlighted that over 80% of the backlog wasexpected to convert into revenue within the next 18 months, which shouldalleviate market concerns about clients' early bookings due to geopoliticalconsiderations (with the ATU segment being an exception). Additionally,mgt. indicated that new orders signed in 1H24 increased by ~25% YoY. Thestrong order growth demonstrates the resilient demand for WuXi AppTec'shigh-quality services, indicating a positive outlook for FY25 growth. 　　TIDES business continued to be a major growth engine. Revenue ofTIDES business reached RMB2.08bn in 1H24, demonstrating robust YoYgrowth of 57.2%, following a significant 64.4% YoY increase in 2023. As ofJune 2024, the TIDES backlog grew substantially by 147% YoY. In January2024, the Company’s new peptide production facilities commencedoperation, which expanded its total capacity to 32,000 liters, positioning theCompany as a leader in global TIDES CDMO. With the robust backlog andreadily available production capacity, mgt. expects TIDES revenue to growby over 60% YoY in 2024 and to maintain the strong momentum in 2025.Our model projects TIDES revenue to exceed RMB8.6bn in 2025,contributing ~20% to WuXi AppTec’s total revenue, a significant increasefrom ~4% in 2022. 　　Maintain BUY. Factoring in the positive trend of customer demand, we liftour TP from RMB53.23 to RMB54.27 (based on a 10-year DCF model withWACC of 10.38% and terminal growth of 2.0%). We forecast revenue togrow by -4.4%/ +10.9%/ +10.8% YoY and adjusted non-IFRS net income togrow by -8.3%/ +11.6%/ +12.1% YoY in 2024E/ 25E/ 26E, respectively

# 中心思想 * **业绩表现与挑战：** 药明康德(603259 CH)2024年第一季度业绩稳健，营收同比下降11.0%，但经调整的非IFRS净利润同比下降18.3%。尽管面临挑战，公司维持了全年营收指引，并预计调整后的非IFRS净利润率将与2023年持平。 * **业务增长点：** TIDES业务持续成为重要的增长驱动力，收入和未完成订单均保持强劲增长势头。临床CRO&SMO业务也呈现温和复苏态势。 * **客户关系与地缘政治风险：** 公司新增客户数量与去年同期持平，全球Top 20药企的收入有所增长。然而，Biosecure Act草案对公司在美国市场获取新客户和订单产生了一定影响。 * **投资评级调整：** 考虑到地缘政治风险带来的不确定性，将目标价从人民币67.53元下调至人民币53.23元，但维持“买入”评级。 # 主要内容 ## 1Q24 业绩回顾：营收下降但维持全年指引 药明康德(603259 CH)公布了2024年第一季度的业绩，营收为人民币79.82亿元，同比下降11.0%。归属于公司的经常性净利润为人民币20.34亿元，同比增长7.3%。经调整的非IFRS净利润为人民币19.13亿元，同比下降18.3%。一季度营收和经调整的非IFRS净利润分别占我们全年预测的20.4%和16.8%，均略低于历史区间。非IFRS毛利率下降2.3个百分点至38.7%，非IFRS净利润率下降2.1个百分点至24.0%，主要由于COVID商业项目CDMO收入下降、定价侵蚀、测试和生物业务部门新设施的启动以及ATU部门成本上升。非COVID D&M收入（在药明化学业务部门）在2024年第一季度实现了正增长，同比增长1.2%。尽管2024年开局充满挑战，但管理层坚持其2024年营收指引为人民币383-405亿元，预计同比增长2.7%-8.6%（不包括COVID-19商业项目收入）。此外，管理层重申，经调整的非IFRS净利润率将与2023年持平。 ## TIDES 业务：显著增长驱动力 TIDES业务继续成为重要的增长驱动力。2024年第一季度，TIDES业务收入同比增长43.1%，未完成订单同比增长110%。收入和未完成订单均保持了2023年的强劲势头。管理层预计TIDES业务在2024年将实现60%的收入增长。此外，新增的22,000升固相肽合成器已于2024年1月投入运营，使总产能达到32,000升。目前正计划在江苏泰兴扩大新的肽生产能力，以满足强劲的客户需求。 ## 临床 CRO&SMO 业务：温和复苏 临床CRO&SMO业务呈现温和复苏态势。2024年第一季度，临床CRO&SMO业务收入同比增长11.0%，其中SMO收入同比增长26.4%。这一增长与国内几家临床CRO&SMO公司在2023年和2024年第一季度报告的上升趋势一致。预计中国临床阶段药物研发的需求将引领复苏，与海外市场自2023年第一季度以来的复苏模式相似。 ## 客户关系：稳固但面临地缘政治不确定性 尽管存在不确定性，药明康德的客户关系依然稳固。2024年第一季度，公司新增客户超过300家，与2023年第一季度持平。令人鼓舞的是，来自全球Top 20制药公司的收入达到人民币27亿元（约占总收入的34%），同比增长4.2%（不包括COVID-19商业项目）。然而，管理层承认，Biosecure Act草案已开始影响药明ATU在美国市场获取新客户和订单。 ## 盈利预测与估值调整：下调目标价但维持买入评级 考虑到地缘政治风险带来的不确定性，我们将目标价从人民币67.53元下调至人民币53.23元（基于10年期DCF模型，WACC为10.73%，永续增长率为2.0%）。我们预测2024E/25E/26E的营收将分别同比下降5.6%/增长10.0%/增长12.5%，经调整的非IFRS净利润将分别同比下降12.4%/增长10.5%/增长16.4%。 # 总结 * **业绩与展望：** 药明康德一季度业绩受到挑战，但公司维持全年营收指引，并看好TIDES业务和临床CRO&SMO业务的增长潜力。 * **风险与应对：** 地缘政治风险对公司在美国市场业务产生影响，公司需积极应对。 * **投资建议：** 尽管下调目标价，但维持“买入”评级，反映了对公司长期发展前景的信心。

# 中心思想 * **一季度业绩符合预期：** 剔除新冠疫苗相关收入后，一季度收入与去年同期持平，盈利能力受成本控制措施推动有所改善。 * **需求显著复苏：** 一季度新签订单恢复至双位数增长，且增长趋势延续至四月，主要受益于跨国药企和国内药企订单的增加。 * **维持买入评级：** 考虑到盈利预测的放缓和需求复苏步伐的不确定性，将目标价从68.57人民币下调至66.82人民币，但维持买入评级。 # 主要内容 ## 公司更新 * **一季度业绩回顾：** * 2024年一季度，泰格医药实现营收16.6亿元人民币，同比下降8.0%；归属于母公司股东的经常性净利润为3.03亿元人民币，同比下降20.5%。 * 营收和归母经常性净利润分别占全年预估的19.8%和18.0%，与疫情前平均水平基本一致。 * 剔除新冠疫苗相关收入后，一季度营收与去年同期持平。 * 毛利率为37.8%，环比显著提升5.0个百分点，主要得益于持续的成本管理措施以及实验室服务毛利率的环比改善。 * 管理层预计，若剔除新冠疫苗相关收入，一季度毛利率为38.5%，与上一季度持平。 * 管理层目标是，考虑到合同收入加速转化和成本控制措施，二季度归母经常性净利润环比增长25-30%。 * **需求复苏：** * 管理层表示，一季度新签订单恢复至双位数增长，3月份的增长速度较1月和2月有所加快，且增长趋势延续至4月。 * 跨国药企和国内药企的订单占比显著增加，来自美国和澳大利亚的订单依然强劲。 * 受益于生物技术融资的复苏，国内生物技术公司的订单也出现复苏迹象。 * 泰格医药的BD团队将继续专注于探索来自跨国药企和国内药企的机遇。 * **成本控制：** * 泰格医药计划继续控制SG&A费用并优化毛利率。 * 管理层指出，凭借其轻资产业务模式，泰格医药在成本控制方面拥有充足的杠杆，例如，提高分散式临床试验（DCT）平台的使用率（约20%的项目使用，而2023年底约为17%），建立特定治疗领域的综合团队，并根据需要重新分配部门人员。 * **全球化战略：** * 在全球市场，泰格医药的战略是服务于目标全球市场的中国公司，以及难以获得国际CRO服务的海外本地客户。 * 公司已在美国招聘了本地BD团队，目前正在与美国本地客户进行多个项目。 * 泰格医药计划进一步扩大在美国和印度的团队规模，以加强其全球运营。 * **盈利预测与估值：** * 基于10年期DCF模型（WACC：10.95%，终值增长率：2.0%），将目标价从68.57人民币下调至66.82人民币，以反映盈利预测的放缓和需求复苏步伐的不确定性。 * 预计泰格医药2024E/25E/26E的营收将同比增长11.3%/16.2%/20.6%，归母经常性净利润将同比增长11.9%/20.8%/25.6%。 ## 盈利预测调整 * **盈利预测下调：** * 2024E/25E/26E的营收、毛利润、营业利润和调整后净利润均有不同程度的下调。 * 其中，2026E的营收下调幅度最大，为-4.10%。 * **与市场一致预期对比：** * CMBIGM对2024E/25E/26E的营收和毛利润预测低于市场一致预期。 * CMBIGM对2024E/25E/26E的营业利润和调整后净利润预测显著低于市场一致预期，其中2024E的调整后净利润预测低24.43%。 ## 估值 * **DCF估值模型：** * 采用风险调整的DCF估值模型，得出每股价格为66.82人民币。 * 模型关键参数包括WACC（10.95%）和终值增长率（2.00%）。 * **敏感性分析：** * 对WACC和终值增长率进行敏感性分析，显示目标价格对这两个参数的变化较为敏感。 ## 财务概要 * **主要财务指标：** * 提供了2021A至2026E的详细财务报表，包括利润表、资产负债表和现金流量表。 * 关键指标包括营收、净利润、资产、负债、现金流等。 * **增长率与盈利能力：** * 分析了2021A至2026E的营收增长率、毛利率、营业利润率和净利润率等指标。 * 显示公司未来几年将保持稳定增长和盈利能力。 * **估值指标：** * 提供了2021A至2026E的P/E、P/B、P/CFPS和股息率等估值指标。 # 总结 本报告对泰格医药2024年一季度业绩进行了分析，指出公司业绩符合预期，需求正在复苏，并维持买入评级。报告详细分析了公司的财务状况、盈利能力和估值，并对未来的业绩进行了预测。尽管下调了目标价，但仍看好公司未来的发展前景。

# 中心思想 本报告主要分析了欧盟可能对中国医疗器械采购发起IPI调查对迈瑞医疗的影响，并重申了对迈瑞医疗“买入”的评级。 * **IPI调查影响有限：** 报告认为，IPI调查的主要目的是促进国际市场的互惠准入，而非造成双方损失。同时，考虑到迈瑞医疗在欧洲的营收占比不高，且没有超过EUR5mn的欧盟招标项目，因此IPI调查对迈瑞医疗的直接影响有限。 * **维持“买入”评级：** 报告维持对迈瑞医疗的目标价RMB383.43，基于9年期DCF模型（WACC：9.0%，永续增长率：3.0%）。同时，报告指出迈瑞医疗在欧美以外市场仍有巨大的扩张潜力。 # 主要内容 ## 国际采购工具（IPI）法规 * **IPI法规的定义：** IPI法规旨在解决第三国公共采购中的市场保护问题。如果非欧盟国家的行为反复损害欧盟企业进入其采购市场的机会，欧盟委员会可以发起调查。 * **IPI法规的应对措施：** 调查启动后，欧盟委员会将邀请相关第三国进行磋商，以消除或补救任何限制性做法。如果第三国采取令人满意的纠正措施，调查可以随时暂停。否则，欧盟委员会将采取IPI措施，如调整评分或排除投标。 ## IPI法规的影响 * **对跨国医疗器械公司的影响：** 中国是全球医疗器械企业的重要市场。许多跨国公司在中国设立工厂，并遵守国内生产医疗器械的规定，以便参与中国政府采购。 * **对迈瑞医疗的影响：** 迈瑞医疗来自欧洲的收入占其2023年上半年的总收入的5.9%，比例相对较小。此外，迈瑞医疗没有超过500万欧元的欧盟个人招标项目。 ## 盈利预测和估值 * **盈利预测：** 报告对迈瑞医疗未来几年的营收和净利润进行了预测，预计2023年至2025年营收分别为356.54亿元、428.17亿元和513.66亿元人民币，归母净利润分别为116.11亿元、138.64亿元和165.79亿元人民币。 * **估值分析：** 维持目标价RMB383.43，基于9年期DCF模型（WACC：9.0%，永续增长率：3.0%）。 ## 财务摘要 * **财务数据：** 报告提供了迈瑞医疗2020A-2025E的详细财务报表，包括利润表、资产负债表和现金流量表，以及关键财务指标的分析，如增长率、盈利能力、杠杆率、流动性和估值等。 # 总结 本报告分析了欧盟可能对中国医疗器械采购发起IPI调查对迈瑞医疗的影响，认为影响有限。报告维持对迈瑞医疗“买入”的评级，目标价为RMB383.43，并指出公司在欧美以外市场仍有扩张潜力。报告还提供了详细的财务数据和预测，为投资者提供了参考。

　　泰格医药(300347) 　　Tigermed reported 2023 revenue of RMB7,384mn, up 4.2% YoY, and attributablerecurring net income of RMB1,477mn, down 4.1% YoY. Revenue/ attributablerecurring net income missed our forecast by 2.9%/ 12.1%, respectively, mainlydue to shrinking COVID vaccine revenue, slowdown in global R&D activities,and contracted margins stemming from temporary pricing adjustments coupledby relatively lower lab facility utilization. New orders signed in 2023 amountedto RMB7.85bn, down 18.8% YoY, mainly due to ~RMB1.2bn reduction of COVIDpass-through orders. Nonetheless, the total backlog experienced a mild uptickof 2.1% YoY, reaching RMB14.1bn by the end of 2023, which provides a solidfoundation for sustainable growth. Management has observed early indicatorsof a demand resurgence and anticipates that both revenue and attributablerecurring net income will achieve mid-teen growth in 2024E, signaling a robustrecovery from the previous year. 　　Early signs of demand recovery. Tigermed experienced heightenedvolatility in client demand in 2023 due to subdued global biotech funding andescalating competition in the clinical CRO market. However, managementhas observed a positive shift in macro sentiment since late 2023, withbiopharmaceutical funding in China exhibiting a significant sequentialrebound. In Jan-Feb 2024, Tigermend’s new orders regained double-digitgrowth, particularly in the US and Australian markets, according to themanagement. With this trend to continue, management maintains a positiveforecast for full-year demand. Additionally, we want to highlight Tigermed’spromising growth potential in China’s market as the government persistswith its supportive policies for domestic pharmaceutical R&D. 　　Well-progressing globalization strategy. The challenges of the industrydid not dampen Tigermed’s commitment to globalization. Underpinned by agrowing and dedicated team of 110 PMs and CRAs, Tigermed’s US clinicaloperation saw rapid growth in revenue and backlog in 2023. Its localizedclinical operation team enables Tigermed to better capture opportunitiesfrom both Chinese pharmaceutical companies looking to enter the USmarket, as well as from US clients not fully served by global clinical CROs.Tigermed acquired a Croatia-based clinical CRO, Marti Farm, in Jan 2023,further bolstering its service capabilities in Europe. Tigermed hasestablished clinical teams in South Korea, Southeast Asia and Australia.Owing to its strong performance in the global market, Tigermed signed 15MRCT projects in 2023. We think a well-established global network will helpTigermed in mitigating potential geopolitical risks. 　　Maintain BUY. We revised our TP from RMB80.31 to RMB68.57, based ona 10-year DCF model (WACC: 10.95%, terminal growth: 2.0%), to factor inslower projection of revenue and recurring net income growth. We forecastTigermed’s revenue to grow 13.3%/ 17.7%/ 21.9% YoY and attributablerecurring net income to grow 14.2%/ 22.7%/ 27.4% YoY in 2024E/ 25E/ 26E,respectively.

# 中心思想 本报告对药明康德(603259 CH)进行了更新，核心观点如下： * **业务发展稳健：** 药明康德在2023年业务发展稳健，尤其在TIDES业务方面表现突出，收入显著增长，且在药物安全评估和SMO业务领域保持领先地位。 * **积极应对地缘政治风险：** 公司管理层积极与客户合作，确保业务连续性，并强调公司不涉及人类基因组学领域，与任何政治或军事组织无关联，从而降低地缘政治风险带来的不确定性。 * **维持买入评级：** 考虑到地缘政治风险带来的不确定性，将目标价从116.01人民币下调至67.53人民币，但维持买入评级，基于DCF模型，预测未来几年收入和净利润将保持增长。 # 主要内容 ## 2023年业绩回顾 药明康德2023年收入为403亿元人民币，同比增长2.5%；归属于上市公司股东的经常性净利润为97亿元人民币，同比增长16.8%；经调整的非IFRS净利润为109亿元人民币，同比增长15.5%。剔除COVID-19商业化项目收入，公司收入同比增长25.6%。 ## 业务发展亮点 * **TIDES业务增长显著：** 凭借32k L的固相合成器产能，多肽生产的TIDES业务收入同比增长64.4%，2022年同比增长337%。截至2023年12月，TIDES业务的积压订单同比增长226%。 * **药物安全评估和SMO业务领先：** 药物安全评估和SMO业务收入分别同比增长27.3%和26.1%，进一步巩固了在各自市场的领先地位。 * **DDSU获得新药批准：** DDSU在2023年获得NMPA批准了三款为客户开发的新药，另有两款处于NDA审查阶段，并开始获得特许权使用费收入。 ## 确保业务连续性 药明康德管理层重申公司不参与人类基因组学领域，与任何政治实体、政府或军事组织没有联系，不对任何国家构成国家安全威胁。客户关系保持稳固，部分客户正在就后期阶段项目的长期合同进行讨论。 ## 股份回购计划 药明康德已注销2023年H股奖励计划下的12亿元人民币H股。继2023年2月完成10亿元人民币A股回购后，公司正在进行另一次10亿元人民币的A股回购。 ## 盈利预测与估值调整 考虑到地缘政治风险带来的不确定性，将目标价从116.01人民币下调至67.53人民币（基于10年期DCF模型，WACC为10.73%，终值增长率为2.0%）。预计2024E/25E/26E收入将分别同比增长-3.0%/+10.3%/+11.1%，调整后的非IFRS净利润将分别同比增长-5.5%/+10.8%/+12.9%。 # 总结 本报告分析了药明康德2023年的业绩和业务发展情况，强调了公司在TIDES业务、药物安全评估和SMO业务方面的优势。同时，报告也关注到地缘政治风险对公司估值的影响，并下调了目标价，但维持了买入评级。报告认为，药明康德通过积极与客户合作、确保业务连续性以及股份回购等措施，有望应对地缘政治风险带来的挑战，并在未来几年保持增长。

# 中心思想 本报告主要分析了药明康德(603259 CH)的最新业绩和未来增长动力，并维持“买入”评级。 * **非新冠业务健康增长与全年目标调整：** 报告指出，尽管早期研发服务需求疲软，导致全年收入增长目标下调，但非新冠业务依然保持健康增长，同时上调了非IFRS毛利率目标，反映了运营效率的提升。 * **TIDES业务成为新增长引擎：** 报告强调，TIDES（主要包括寡核苷酸和多肽）业务将成为公司未来重要的增长驱动力，该业务在2023年前三季度实现了显著增长，且订单储备大幅增加。 # 主要内容 ## 业绩回顾与展望 * **三季度业绩概览：** 药明康德2023年第三季度收入同比增长0.3%，达到人民币106.7亿元；归属于公司的经常性净利润同比增长23.8%，达到人民币29.48亿元；归属于公司的调整后非IFRS净利润同比增长24.3%，达到人民币30.72亿元。 * **全年业绩展望调整：** 考虑到早期研发服务需求的疲软，管理层将全年收入同比增长目标从5-7%下调至2-3%，但同时将非IFRS毛利率目标小幅上调0.5%至41.7-42.1%。 ## 业务分析 * **非新冠项目增长强劲：** 剔除商业COVID-19项目后，药明康德2023年前三季度收入同比增长23.4%，主要得益于化学业务中D&M服务48.2%的同比增长。 * **TIDES业务增长迅猛：** 2023年前三季度，TIDES业务收入同比增长38.1%，2022年同比增长337%。截至2023年9月，TIDES业务的订单储备同比增长245%，管理层预计2023年和2024年TIDES业务收入将分别增长60%以上。 * **产能扩张计划：** 为满足多肽药物快速增长的需求，药明康德计划在2023年底前将其用于多肽生产的固相合成器产能增加到32,000升，比原计划提前一年。 ## 财务分析 * **盈利预测：** 预计药明康德2023E/24E/25E收入将分别同比增长2.8%/17.2%/23.5%，调整后非IFRS净利润将分别同比增长15.2%/17.8%/24.7%。 * **估值分析：** 基于10年期DCF模型，WACC为10.73%，终端增长率为2.0%，维持目标价人民币116.01元。 ## 其他事项 * **终止激励计划与股份回购：** 管理层提议终止2023年H股激励计划，并回购及注销超过1550万股H股（约占总股本的0.52%），价值13亿港元。 # 总结 本报告对药明康德的最新业绩进行了分析，并强调了TIDES业务作为新的增长引擎的潜力。尽管面临早期研发服务需求疲软的挑战，公司通过提高运营效率和调整业务结构，依然保持了稳健的增长态势。维持“买入”评级，目标价为人民币116.01元。

　　泰格医药(300347) 　　Tigermed reported 3Q23 revenue of RMB1,940mn, up 7.1% YoY (vs +3.3%YoY in 1H23), and attributable recurring net income of RMB405mn, down 3.8%YoY (vs +2.9% YoY in 1H23). 3Q23 revenue accounted for 24.9% of our 2023full-year estimate, in line with its historical average, while attributable recurringnet income represented 22.7% of our forecast, which fell short of its historicalaverage of ~27%. If excluding COVID vaccine revenue, 3Q23 revenue wouldgrow by ~18% YoY (vs ~27% YoY in 1H23). Management indicated a policyheadwind impacting patient enrolments in 3Q23, which has already largelyresumed normal by late Sep. Gross profit margin (GPM) in 3Q23 continuouslyrose to 41.2%, improving by 1.0ppt QoQ and 0.2ppt YoY. According tomanagement, GPM would be ~41.7% if excluding COVID vaccine revenue,which declined 1.3ppt YoY. The adj. gross margin dilution was mainly due tothe impact from policy headwinds, margin pressure from lab business and thestrong recovery of low-margin SMO services. Additionally, new orders(excluding pass-through fees) signed in the quarter achieved positive growthamid the harsh business environment. Tigermed’s operating cash flows in 9M23was RMB673mn, down 18.5% YoY. 　　Globalization to serve as a long-term driver. Tigermed acquired aCroatia-based clinical CRO, Marti Farm, in Jan 2023, further enhancing itsservice capability in Europe. Althrough the Company adjusted its personnelin Europe to reflect the post-COVID demand changes, Europe still plays acritical role for patient enrolments in MRCTs as well as for biosimilarprojects. In the US, Tigermed doubled its local clinical operation team tomore than 110 staff in 1H23. In the Europe and US market, Tigermedstrategically aims to collaborate with small- to mid- sized companies withintention of incorporating China in their MRCTs (especially CGT projects)and Chinese clients going to overseas markets. Management expected thegrowth of the US and EU business to outpace that of Tigermed as a whole.Besides, Southeast Asia and Latin America market with large populationbases continue to remain as strategic end markets for Chinese pharmacompanies in the long term, creating extra business opportunities forTigermed. 　　ADC and obesity to trigger additional clinical demands. Although theglobal biotech market has saw an initial inflection point in terms of financing,management of Tigermed pointed out the continuously decreasing risktolerance of clients, leading to the longer waiting time from request-forproposals (RFPs) to contract signing. However, management indicated thatthe successful POC and commercialization of certain products ininternational market, such as ADC and obesity drugs, will bring additionalclinical demands to clinical CROs. Specifically, Tigermed has alreadyobserved a growing interest from client on obesity drugs. 　　Maintain BUY. We revised our TP from RMB94.41 to RMB80.31, based ona 10-year DCF model (WACC: 11.5%, terminal growth: 3.0%), to factor inslower projection of recurring net income growth. We forecast Tigermed’srevenue to grow 7.3%/ 24.9%/ 26.0% YoY and attributable recurring netincome to grow 9.2%/ 23.8%/ 27.6% YoY in FY23E/ 24E/ 25E, respectively.

　　泰格医药(300347) 　　Tigermedreported1Q23revenueofRMB1,805mn,down0.7%YoY,andattributablerecurringnetincomeofRMB381mn,up0.7%YoY.1Q23revenue/attributablerecurringnetincomeaccountedfor21.2%/19.2%respectivelyofour2023full-yearestimates,whichwereinlinewithitshistoricalaveragelevel.1Q23revenuewouldgrowby27-28%YoYifexcludingCOVIDrelatedrevenue.Grossprofitmargin(GPM)in1Q23was39.7%,improvingby1.6pptQoQand0.8pptYoY,thankstothedecreasedproportionofrevenuefromCOVID-19relatedprojects(includingpass-throughrevenuetooverseassub-contractors)aswellasbusinessnormalizationinChinasinceFeb2023.Accordingtomanagement,GPMwouldbeabove41%ifexcludingCOVIDpass-throughrevenue.Neworderssignedin1Q23waslargelyflatYoY,whilemanagementexpectsasignificantpickupinnewordersgrowthfrom2Q23giventherecoveryofrequestsforproposalsince1Q23. 　　Operation fully resumed after the COVID pandemic, laying a soundfoundation for full-year growth. Management indicated that COVIDinfection among employees had disrupted business operations in Jan 2023,with China-based laboratory services taking the most hit. According toFrontage (1521 HK), revenue declined by 1.8% YoY while adjusted net profitdropped by 77% YoY in 1Q23. With business operation resumed normal,management expected both revenue and GPM to see sequentialimprovements in 2Q23. 　　Globalization remains a business focus. Tigermed acquired a Croatiabased clinical CRO, Marti Farm, in Jan 2023, further enhancing its servicecapability in Europe. The Company is integrating its BD team in Europe toenhance BD capabilities. In the US, Tigmerd aims to double its local clinicaloperation team to over 100 staff in 2023. The Company’s strategies inEurope and US include collaborating with small- to mid- sized clients withrelatively inadequate access to resource of global clinical CROs andChinese clients going to developed markets. Additionally, Tigermed takes aproactive approach in Southeast Asia and Latin America. Such regions arepotential end markets for Chinese drug developers, which will createadditional demand for Tigermed in overseas market. 　　Operating cash flow to recover. Net operating cash flow substantiallydeclined by 91% YoY to RMB29mn, due to 1) delay in part of cost paymentfrom 4Q22 to 1Q23 due to COVID outbreak; 2) sizable income from COVIDvaccine projects in 1Q22 which caused a high base; and 3) the increasingstaff cost due to the growing employee number. Management guided netoperating cash flow to rebound from 2Q23. 　　Maintain BUY. We revised our TP from RMB134.24 to RMB123.50, basedon a 10-year DCF model (WACC: 10.6%, terminal growth: 3.0%), to factorin slower revenue growth projection. We forecast Tigermed’s revenue togrow 15.4%/ 25.0%/ 24.1% YoY and attributable recurring net income to grow21.8%/ 25.0%/ 25.3% YoY in FY23E/ 24E/ 25E, respectively.