20250402-招银国际-康方生物-09926.HK-AK112_to_validate_its_potential_as_next-generation_IO_therapy_5页_817kb

Akeso (9926 HK) Summary

Core Content

Akeso is a biotechnology company focused on oncology drug development, with a particular emphasis on immune-oncology (IO) therapies. The company has shown strong performance in cost control and is poised for significant growth in FY25 due to the inclusion of AK104 and AK112 in the National Reimbursement Drug List (NRDL). This inclusion is expected to drive a 60% YoY increase in product sales, reaching RMB3.3bn in FY25. Akeso also maintains a solid cash balance of RMB7.3bn as of end-2024, which supports ongoing R&D and future commercial expansion.

Key Points

Financial Performance

• FY24 Revenue: RMB2.1bn (RMB2.0bn from product sales), a 25% YoY increase.
• Operating Efficiency: SG&A-to-product sales ratio reduced to 61% from 69% in FY23.
• R&D Expenses: Decreased by 5% YoY to RMB1.2bn.
• Net Loss: RMB500mn in FY24, with EBITDA loss of RMB225mn.
• Sales Projections:
  • FY25E: RMB3.3bn (+60% YoY)
  • FY26E: RMB5.072bn (+49.8% YoY)
  • FY27E: RMB8.110bn (+59.9% YoY)

Earnings and Profitability

• EPS (Reported):
  • FY24A: -0.59
  • FY25E: -0.21
  • FY26E: +0.46
  • FY27E: +1.88
• Profitability:
  • Gross margin: Improved from 86.4% in FY24A to 85.0% in FY27E.
  • Operating margin: Negative in FY25E (-8.8%) but expected to improve in FY26E and FY27E.
  • Return on equity (ROE): Negative in FY24A (-8.7%) but projected to reach 21.8% in FY27E.

DCF Valuation

• DCF per share (HK$): HK$102.61
• Terminal Growth Rate: 3.0%
• WACC: 9.17%
• Equity Beta: 1.0
• Risk-Free Rate: 2.5%
• Market Risk Premium: 10.5%
• Equity Value: RMB85,652mn
• Net Debt: RMB-2,542mn (negative, indicating strong liquidity)
• Share Capital: RMB0mn
• Other Reserves: RMB6,622mn in FY25E, increasing to RMB8,383mn in FY27E

Key Viewpoints on AK112

Clinical Performance

• Pivotal Trial in China: AK112 demonstrated a meaningful progression-free survival (PFS) benefit over Keytruda in first-line PD-L1-positive non-small cell lung cancer (NSCLC).
• Global Trial: Summit's global Ph3 trial of AK112 plus chemotherapy versus chemotherapy alone in EGFR-TKI-resistant NSCLC is expected to release data in mid-2025.
• China Cohort Data: mPFS of 7.1 vs 4.8 months (HR=0.46), and mOS of 17.1 vs 14.5 months (HR=0.80, 0.59-1.08) at 52% data maturity.
• OS Data: Expected to be a key catalyst for validating AK112's clinical advantage, especially with the availability of other novel therapies post-progression.

Strategic Expansion

• Clinical Trials: Akeso is expanding AK112's application to other cancers, including TNBC, MSS CRC, BTC, HNSCC, and pancreatic cancer.
• Combination Therapies: Exploring PD(L)-1/VEGF and ADC combinations, which could be revolutionary for oncology treatments.
• Collaborations: Partnering with Pfizer to evaluate AK112 in combination with their ADCs.
• In-House ADC Pipeline: Includes HER3-targeting AK138D1 (in clinical studies) and Trop2/Nectin4 BsAb-ADC AK146D1 (expected to enter Ph1 trials in 1H25).

Key Information

Analyst Ratings

• Recommendation: Maintain BUY
• Target Price: HK$102.61 (up from previous TP of HK$58.97)
• Upside/Downside: 19.3%

Stock Data

• Market Cap (HK$ mn): 77,191.5
• Average 3 Months Turnover (HK$ mn): 603.0
• 52-Week High/Low (HK$): 86.00 / 31.80
• Total Issued Shares (mn): 897.6

Shareholding Structure

• Yu Xia: 12.1%
• Baiyong Li: 6.4%

Share Performance

• 1-Month Return: 17.9%
• 3-Month Return: 41.7%
• 6-Month Return: 25.4%

Financial Summary Highlights

Valuation and Sensitivity Analysis

• DCF per Share (HK$): HK$102.61
• Terminal Growth Rate: 3.0%
• Sensitivity Analysis:
  • At 3.0% terminal growth and 9.17% WACC, the valuation is HK$102.61.
  • At 4.0% terminal growth and 8.17% WACC, the valuation is HK$149.17.
  • At 2.0% terminal growth and 10.17% WACC, the valuation is HK$85.45.

CMBIGM Estimates Revision

Conclusion

Akeso is positioned to benefit significantly from the inclusion of AK112 in the NRDL, which is expected to drive a substantial increase in product sales in FY25. The drug's clinical performance in pivotal trials, especially the head-to-head comparison with Keytruda in first-line PD-L1-positive NSCLC, is a key value driver. Additionally, the company is exploring a broad range of first-line applications and ADC combinations, which could further enhance its market position. The financial outlook shows improving operating efficiency and a strong cash position, supporting future growth. The analyst maintains a BUY rating with an updated target price of HK$102.61.