20230302-招银国际-和黄医药-00013.HK-Exploit_global_market_opportunities_5页_1mb

Summary of Hutchmed (13 HK)

Core Content

Hutchmed (13 HK) is a biopharmaceutical company focused on oncology and other therapeutic areas. The document highlights the company's recent financial performance, its key drug developments, and the investment outlook based on DCF valuation and market analysis.

Financial Performance

• Revenue:

  • FY21A: US$356mn
  • FY22A: US$426mn (+19.7% YoY)
  • FY23E: US$816mn (+91.4% YoY)
  • FY24E: US$894mn (+9.6% YoY)
  • FY25E: US$1,066mn (+19.2% YoY)

• Net Profit:

  • FY21A: (US$167.0mn)
  • FY22A: (US$360.4mn)
  • FY23E: (US$138.9mn)
  • FY24E: (US$65.3mn)
  • FY25E: US$33.7mn

• Earnings Per Share (EPS):

  • FY21A: (US$0.43)
  • FY22A: (US$0.16)
  • FY23E: (US$0.08)
  • FY24E: (US$0.04)

• R&D Expenses:

  • FY22A: US$386.9mn (+29% YoY)
  • FY23E: US$390mn
  • FY24E: US$376mn
  • FY25E: US$352mn

• Cash Position:

  • As of end-2022: US$631.0mn

• Target Price: HK$37.49 (Previously HK$36.06)

Key Drug Developments

• Fruquintinib:

  • Achieved US$93.5mn in FY22 sales and US$69.9mn revenue.
  • Became a market leader for 3L CRC in China with a 44% patient share in 4Q22.
  • Out-licensed ex-China rights to Takeda in Jan 2023, eligible for US$400mn upfront and up to US$730mn in milestones.
  • Plans to complete BLA rolling submission in 1H23 for the US, with EU and Japan to follow.
  • Positive PFS results from the Ph3 FRUTIGA trial in 2L GC, with OS endpoint not met.
  • Intends to file sBLA for 2L GC in 1H23.
  • Expected to be approved in China for 2L GC due to superior results compared to ramucirumab.

• Savolitinib:

  • In-market sales grew by 159% YoY to US$41.2mn in FY22, contributing US$22.3mn to HCM.
  • NRDL inclusion in Mar 2023 is expected to further drive sales growth.
  • Plans to continue Ph2 SAVANNAH study and evaluate US accelerated approval.
  • Expected to release data of potential registrational Ph2 trial for GC in 1H23.

• Sovleplenib (Syk):

  • Pivotal trial ESLIM-01 for 2L ITP was fully enrolled in Dec 2022.
  • HCM expects data readout and potential NDA in 2H23.

• Amdizalisib (PI3Kδ):

  • Ph2b trial in 2L FL completed enrolment in Feb 2023.
  • Expected to release data and file NDA in 2H23.

Investment Outlook

• Rating: BUY (Maintain)
• Target Price: HK$37.49
• DCF Valuation:
  • Based on WACC of 9.51% and terminal growth rate of 2%.
  • Equity value: HK$32,421mn
  • DCF per share: HK$37.49
• Sensitivity Analysis:
  • Terminal growth rate has a significant impact on valuation, with lower growth rates reducing the target price.
  • The report highlights that the current valuation is based on conservative assumptions.

Shareholding and Market Data

• Shareholding Structure:

  • CK Hutchison Holdings: 38.5%
  • The Capital Group: 11.2%

• Stock Performance:

  • Market Cap: HK$2,730.0mn
  • 3-month total return: 28.8%
  • 6-month total return: 39.1%
  • 12-month price performance: (see image)

Analyst Certification and Risk Disclosures

• The analyst certifies that the views expressed in the report accurately reflect their personal views and that there are no conflicts of interest.
• The report includes important disclosures regarding the risks involved in investing and the limitations of the information provided.
• CMBIGM is not a registered broker-dealer in the US and does not provide individually tailored investment advice.

Conclusion

Hutchmed (13 HK) is showing strong growth in oncology product sales, with significant potential for future approvals and revenue growth. The company's strong financial position and ongoing R&D efforts support its long-term value proposition. The BUY rating reflects confidence in its ability to deliver returns over the next 12 months.