HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Gracell Biotechnologies Inc / Equity Bottom-Up

<ul>
<li>Ministry of Finance and National Health Commission issued new policy strictly prohibiting public hospitals from borrowing to purchase medical equipment, which will change the investment logic of medical device sector.</li>
<li>“PD-1+ADC” is expected to replace “PD-1+chemotherapy” as the first-line standard therapy. This will be a huge market. So, good story of ADC CDMO (such as WuXi XDC) would continue.</li>
<li>The inspiration that AstraZeneca's acquisition of Gracell brings to investors is IPO isn’t the only way for exit.Being acquired is also good, which will become more important in the future.</li>
</ul>


Ministry of Finance and National Health Commission issued new policy strictly prohibiting public hospitals from borrowing to purchase medical equipment, which will change the investment logic of medical device sector.
“PD-1+ADC” is expected to replace “PD-1+chemotherapy” as the first-line standard therapy. This will be a huge market. So, good story of ADC CDMO (such as WuXi XDC) would continue.
The inspiration that AstraZeneca's acquisition of Gracell brings to investors is IPO isn’t the only way for exit.Being acquired is also good, which will become more important in the future.


China Healthcare Weekly (Dec.31)-New Medical Device Policy, AstraZeneca to Acquire Gracell, PD-1+ADC

Equity Capital Markets

WuXi XDC Cayman  / Equity Capital Markets

<ul>
<li>WuXi XDC's shares surged since IPO. Obviously, ADC industry is in a "honeymoon period". The market is optimistic about ADC due to high certainty and growth visibility in short term.</li>
<li>Pharmaceutical companies believe this platform would produce blockbuster products continuously. However, if there’s any “persuasive event” to change optimistic expectations on ADC, it's time for investors to reconsider WuXi XDC.</li>
<li>“Positive sentiment + non-falsifiable short-term logic” would indeed push WuXi XDC's shares to a new high. As long as sales of major ADCs are in line with expectations, party continues.</li>
</ul>


WuXi XDC's shares surged since IPO. Obviously, ADC industry is in a "honeymoon period". The market is optimistic about ADC due to high certainty and growth visibility in short term.
Pharmaceutical companies believe this platform would produce blockbuster products continuously. However, if there’s any “persuasive event” to change optimistic expectations on ADC, it's time for investors to reconsider WuXi XDC.
“Positive sentiment + non-falsifiable short-term logic” would indeed push WuXi XDC's shares to a new high. As long as sales of major ADCs are in line with expectations, party continues.


WuXi XDC (2268.HK) - How Long Will the Rally Last?

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.

<ul>
<li>Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.</li>
<li>In the IPO space, <a href="https://www.smartkarma.com/entities/wuxi-xdc-cayman-inc" target="_blank" data-smartkarma-citation="entities:39917:1" rel="noopener">WuXi XDC</a> ended up doing well, as expected. Now <a href="https://www.smartkarma.com/entities/tata-technologies" target="_blank" data-smartkarma-citation="entities:23700:1" rel="noopener">Tata Technologies </a>will be another one to watch.</li>
<li>The placements continued to flow in this week as well, with both Australia and Japan deals coming relatively thick and fast, at least by 2023's pace.</li>
</ul>


Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
In the IPO space, WuXi XDC ended up doing well, as expected. Now Tata Technologies will be another one to watch.
The placements continued to flow in this week as well, with both Australia and Japan deals coming relatively thick and fast, at least by 2023's pace.


ECM Weekly (19th Nov 2023)- Asahi, Ajinomoto, Steadfast, Karoon, Wuxi, Ecopro, Zeekr, Tata Tech

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>Wuxi XDC priced its IPO at HK$20.60 per share (upper-end of range), and raised HK$3.5bn (US$417m) at a market capitalisation of HK$24.3bn and post-money EV of HK$20.4bn.</li>
<li>Both HK offering and the international offering of the company were significantly oversubscribed by 49.96x and 19.6x respectively.</li>
<li>Our DCF value per share is still at a significant premium to the final IPO price, and we expect Wuxi XDC’s IPO to have a strong debut.</li>
</ul>


Wuxi XDC priced its IPO at HK$20.60 per share (upper-end of range), and raised HK$3.5bn (US$417m) at a market capitalisation of HK$24.3bn and post-money EV of HK$20.4bn.
Both HK offering and the international offering of the company were significantly oversubscribed by 49.96x and 19.6x respectively.
Our DCF value per share is still at a significant premium to the final IPO price, and we expect Wuxi XDC’s IPO to have a strong debut.


IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wuxi-xdc-cayman-inc" target="_blank" data-smartkarma-citation="entities:39917:1" rel="noopener">WuXi XDC Cayman (1877628D HK)</a> priced its IPO at HK$20.60 per share to raise the gross proceeds of US$470 million. The shares will start trading tomorrow.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/wuxi-xdc-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:116331" rel="noopener">WuXi XDC IPO: The Bull Case</a>, <a href="https://www.smartkarma.com/insights/wuxi-xdc-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:116507" rel="noopener">WuXi XDC IPO: The Bear Case</a> and <a href="https://www.smartkarma.com/insights/wuxi-xdc-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:116962" rel="noopener">WuXi XDC IPO: Valuation Insights</a>.</li>
<li>The market sentiment on the sector has modestly weakened. However, the IPO price is attractive, with our DCF valuation of HK$22.89 per share, 11.1% above the IPO price.</li>
</ul>



WuXi XDC Cayman (1877628D HK) priced its IPO at HK$20.60 per share to raise the gross proceeds of US$470 million. The shares will start trading tomorrow.
We previously discussed the IPO in WuXi XDC IPO: The Bull Case, WuXi XDC IPO: The Bear Case and WuXi XDC IPO: Valuation Insights.
The market sentiment on the sector has modestly weakened. However, the IPO price is attractive, with our DCF valuation of HK$22.89 per share, 11.1% above the IPO price.


China

WuXi XDC Cayman Inc. operates as a leading contract testing, development and manufacturing organization focused on the global antibody drug conjugates and broader bioconjugate market. The Company provides bioconjugation discovery, analytical development, intermediate and conjugation manufacturing, and other services. WuXi XDC Cayman provides its services worldwide.

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WuXi XDC Cayman (2268 HK)

China Healthcare Weekly (Dec.31)-New Medical Device Policy, AstraZeneca to Acquire Gracell, PD-1+ADC

As new policy prohibits public hospitals from borrowing to purchase medical device, investment logic changes. AZ-Gracell deal has epoch-making...

Xinyao (Criss) Wang

WuXi XDC (2268.HK) - How Long Will the Rally Last?

Last Friday, WuXi XDC's share price hit new high, and that is just the beginning. AbbVie pays US$10B to acquire ImmunoGen indicates that ADC...

Xinyao (Criss) Wang

ECM Weekly (19th Nov 2023)- Asahi, Ajinomoto, Steadfast, Karoon, Wuxi, Ecopro, Zeekr, Tata Tech

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

Wuxi XDC: Thoughts on First Day Trading

Wuxi XDC priced its IPO at HK$20.60 per share, at the upper end of the IPO price range. The company raised HK$3.5bn and the offering was...

Shifara Samsudeen, FCMA, CGMA

WuXi XDC IPO: Trading Debut

The market sentiment on the sector has modestly weakened. However, the IPO price is attractive, with our DCF valuation of HK$22.89 per share, 11.1%...

Arun George

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China Healthcare Weekly (Dec.31)-New Medical Device Policy, AstraZeneca to Acquire Gracell, PD-1+ADC

As new policy prohibits public hospitals from borrowing to purchase medical device, investment logic changes. AZ-Gracell deal has epoch-making...

Xinyao (Criss) Wang

WuXi XDC (2268.HK) - How Long Will the Rally Last?

Last Friday, WuXi XDC's share price hit new high, and that is just the beginning. AbbVie pays US$10B to acquire ImmunoGen indicates that ADC...

Xinyao (Criss) Wang

ECM Weekly (19th Nov 2023)- Asahi, Ajinomoto, Steadfast, Karoon, Wuxi, Ecopro, Zeekr, Tata Tech

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

Wuxi XDC: Thoughts on First Day Trading

​Wuxi XDC priced its IPO at HK$20.60 per share, at the upper end of the IPO price range. The company raised HK$3.5bn and the offering was...

Shifara Samsudeen, FCMA, CGMA

WuXi XDC IPO: Trading Debut

The market sentiment on the sector has modestly weakened. However, the IPO price is attractive, with our DCF valuation of HK$22.89 per share, 11.1%...

Arun George

Wuxi XDC priced its IPO at HK$20.60 per share, at the upper end of the IPO price range. The company raised HK$3.5bn and the offering was...