Huaxi Securities has initiated coverage on GRAND PHARMA (00512) with an "Overweight" rating, citing the company's comprehensive radiopharmaceutical value chain and upcoming innovative drug launches as key drivers for valuation upside. The brokerage forecasts the company's total revenue to reach HK$12.27 billion, HK$13.46 billion, and HK$14.70 billion for 2025-2027, with net profit attributable to shareholders of HK$2.01 billion, HK$2.25 billion, and HK$2.56 billion, respectively. Corresponding EPS is projected at HK$0.57, HK$0.63, and HK$0.72.
GRAND PHARMA's globally first-in-class drug STC3141 has achieved success in China's Phase II clinical trials, showing significant reduction in SOFA scores at day 7 (p<0.05) and consistent trends in secondary endpoints (28-day mortality, ICU stay duration). Targeting sepsis immunodysregulation through its novel histone/NETs neutralization mechanism, the drug could fill a 40-year global therapeutic gap, potentially unlocking a multi-billion market while elevating the company's international profile in critical care. Investors should monitor upcoming Phase III data and global registration plans.
The company maintains a solid foundation with over 260 national reimbursement drugs, including respiratory core products driving 27% segment growth in 2024. Innovative and high-barrier products now contribute 51% of H1 2025 revenue (vs. 36.1% YoY), demonstrating successful transformation. Key growth drivers include Yigan Tai®, Enzhuorun®/Enmingrun (asthma inhalants), LavaTM, Neng Qilang®, and Hexin Shuang®/Hebei Shuang®, creating a balanced portfolio of stable traditional businesses and high-growth innovative therapies.
With radiopharmaceutical expansion, innovative drug launches, and steady traditional business support, GRAND PHARMA is poised for potential value re-rating.
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