GENSCRIPT BIO(01548) 交银国际证券·2024-03-11 16:00Investment Rating - The report assigns a "Buy" rating for the company, Kingsray Biotech (1548 HK), with a target price of HKD 27.75, indicating a potential upside of 78.8% from the current closing price of HKD 15.52 [1][10]. Core Insights - The company demonstrated resilience in its performance during 2023, with revenues reaching USD 840 million, a year-on-year increase of 34.2%, aligning closely with previous expectations [1]. - Adjusted net loss for 2023 was USD 298 million, significantly better than the anticipated loss of USD 395 million, showcasing improved operational efficiency [1]. - The overall gross margin stood at 48.8%, exceeding the forecast of 46.5%, primarily driven by the rapid improvement in the gross margin of the cell therapy segment [1]. - The report anticipates a recovery in the company's CDMO business in 2024, supported by a gradual improvement in overseas financing and accelerated market expansion [1]. Revenue Performance and Guidance - Non-cell therapy business segments showed robust growth, with life sciences services generating external revenue of USD 405 million, up 16% year-on-year, slightly exceeding expectations [2]. - The report provides guidance for 2024, projecting a revenue growth of 15-20% for life sciences services, with gross margins stabilizing around 55% [2]. - The cell therapy segment is expected to achieve peak sales of at least USD 5 billion for cilta-cel, with production capacity anticipated to double by the end of 2025 [2]. Financial Projections - The report slightly adjusts revenue forecasts for 2024 and 2025 down by 0.6% and 0.5%, respectively, but reduces the net loss forecast for 2024 by 4% and increases the net profit forecast for 2025 from USD 940 million to USD 1.48 billion [2]. - The introduction of 2026 profit forecasts estimates revenue at USD 2.16 billion, with a compound annual growth rate (CAGR) of 37% from 2023 to 2026 [2]. Valuation and Target Price - The report employs a sum-of-the-parts (SOTP) valuation method, leading to a target price of HKD 27.75, maintaining the "Buy" rating [2][8]. - The valuation breakdown indicates that the cell therapy segment contributes significantly to the overall target valuation, accounting for 69% of the total [8].