External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>Full-year guidance cut amid 1H25 miss. HCM’s oncology/immunology product revenue reached US$144mn in 1H25 (-15% YoY), only 36% of our prior full-year estimate.</li><li>The miss was driven by declines in HCM’s China revenue of key products: fruquintinib (-27%), savolitinib (-32%), and surufatinib (-50%), impacted by regorafenib and TAS-102 generic competition, regorafenib VBP, the launch of new NRDL-listed MET TKIs, and internal sales team transitions.</li><li>Although fruquintinib's overseas in-market sales grew 25% YoY to US$163mn, HCM recognized US$43mn revenue from fruquintinib, nearly flat YoY. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Full-year guidance cut amid 1H25 miss. HCM’s oncology/immunology product revenue reached US$144mn in 1H25 (-15% YoY), only 36% of our prior full-year estimate.The miss was driven by declines in HCM’s China revenue of key products: fruquintinib (-27%), savolitinib (-32%), and surufatinib (-50%), impacted by regorafenib and TAS-102 generic competition, regorafenib VBP, the launch of new NRDL-listed MET TKIs, and internal sales team transitions.Although fruquintinib's overseas in-market sales grew 25% YoY to US$163mn, HCM recognized US$43mn revenue from fruquintinib, nearly flat YoY. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Hutchmed (13 HK) - China Product Sales Under Pressure Amid Competition

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Event-Driven

<ul>
<li>PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.</li>
<li>The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.</li>
<li>In this note, we'll talk about the latest developments, possible outcomes and implications.</li>
</ul>


PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.
The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.
In this note, we'll talk about the latest developments, possible outcomes and implications.


China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

<ul><li>Strong fruquintinib overseas sales drove top-line beat. HCM delivered a strong FY24 financial performance, marked by a top-line beat fueled by robust fruquintinib sales internationally.</li><li>Oncology/immunology product revenue grew by 65% YoY to US$272mn, exceeding the previous guidance of 30-50% growth.</li><li>FRUZAQLA (fruquintinib) generated total overseas sales of US$291mn in its first full year on the market, with US$111mn recognized as HCM’s revenue. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Strong fruquintinib overseas sales drove top-line beat. HCM delivered a strong FY24 financial performance, marked by a top-line beat fueled by robust fruquintinib sales internationally.Oncology/immunology product revenue grew by 65% YoY to US$272mn, exceeding the previous guidance of 30-50% growth.FRUZAQLA (fruquintinib) generated total overseas sales of US$291mn in its first full year on the market, with US$111mn recognized as HCM’s revenue. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Hutchmed (13 HK) - Expecting Sustainable Profitability

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Hutchmed China Ltd / Equity Capital Markets

<ul>
<li>HUTCHMED announced the disposal of 45% equity interest in SHPL for US$608 million, including selling 35% equity interest to GP Health Service Capital and 10% equity interest to Shanghai Pharma.</li>
<li>There’re synergies between SHPL and Shanghai Pharma regarding TCM business. It's necessary for HUTCHMED to sell non-core JV to reserve cash flow in advance to focus on innovative drug business.</li>
<li>The entire valuation of SHPL reaches RMB10 billion, or about 15x P/E. If HUTCHMED’s innovative drug business can bear fruit, its valuation has more room to grow in the future.</li>
</ul>


HUTCHMED announced the disposal of 45% equity interest in SHPL for US$608 million, including selling 35% equity interest to GP Health Service Capital and 10% equity interest to Shanghai Pharma.
There’re synergies between SHPL and Shanghai Pharma regarding TCM business. It's necessary for HUTCHMED to sell non-core JV to reserve cash flow in advance to focus on innovative drug business.
The entire valuation of SHPL reaches RMB10 billion, or about 15x P/E. If HUTCHMED’s innovative drug business can bear fruit, its valuation has more room to grow in the future.


HUTCHMED to Divest 45% Stake in Non-Core Joint Venture with Shanghai Pharma

<ul>
<li>HUTCHMED will receive a US$20 million milestone payment from its partner Takeda. In our view, peak sales of fruquintinib is expected to reach about US$700 million in overseas markets.</li>
<li>After the Head of AstraZeneca China has been detained by authorities, AstraZeneca's future commercialization would be affected, which will have a negative impact on savolitinib and HUTCHMED in short term.</li>
<li>Reasonable market value of HUTCHMED based on the three major products is about US$2.7-3.3 billion assuming P/S of 4. If market value is below US$2.5 billion, HUTCHMED is undervalued.</li>
</ul>


HUTCHMED will receive a US$20 million milestone payment from its partner Takeda. In our view, peak sales of fruquintinib is expected to reach about US$700 million in overseas markets.
After the Head of AstraZeneca China has been detained by authorities, AstraZeneca's future commercialization would be affected, which will have a negative impact on savolitinib and HUTCHMED in short term.
Reasonable market value of HUTCHMED based on the three major products is about US$2.7-3.3 billion assuming P/S of 4. If market value is below US$2.5 billion, HUTCHMED is undervalued.


Hutchmed China Ltd (13.HK/​​HCM.US) - The Fundamentals Remain Strong

Hong Kong

HUTCHMED (China) Limited develops, manufactures, and sells pharmaceutical products. The Company offers drugs for oncology and autoimmune diseases treatment. HUTCHMED (China) markets its products worldwide.

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Hutchmed China Ltd (13 HK)

Hutchmed (13 HK) - China Product Sales Under Pressure Amid Competition

Full-year guidance cut amid 1H25 miss. HCM’s oncology/immunology product revenue reached US$144mn in 1H25 (-15% YoY), only 36% of our prior full...

CMB International

China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US...

Sumeet Singh

Hutchmed (13 HK) - Expecting Sustainable Profitability

Strong fruquintinib overseas sales drove top-line beat. HCM delivered a strong FY24 financial performance, marked by a top-line beat fueled by...

CMB International

HUTCHMED to Divest 45% Stake in Non-Core Joint Venture with Shanghai Pharma

HUTCHMED sells 45% stake in SHPL for US$608 million to focus on innovative drug business, which is a right strategic move. If innovative drug...

Xinyao (Criss) Wang