Jinwu Financial News | BOC International released an in-depth report on the biotechnology industry. In 2024, the State Council government work report first proposed speeding up the development of the innovative pharmaceutical industry, building new types of productivity such as biomantry, and encouraging entrepreneurship and equity investment. The bank believes that it will continue to introduce supporting policies in the future to promote the development momentum of pharmaceutical innovation.
The bank believes that the sector has opportunities for valuation repair within 2024, mainly considering: 1) there has been a large degree of disconnection in the past year, and the bank is optimistic about opportunities for Hong Kong stocks to recover compared to US stocks; 2) important overseas events such as overseas licensing/mergers and acquisitions transactions are expected to continue to be implemented in 2024, which is an important catalyst; 3) the bank's judgment on innovative drug policies is beneficial to products with real innovative value or significant differentiation.
For the first time, the bank covered five companies, Hehuang Pharmaceutical (00013/HCM US), Connoya (02162), Cinda Biotech (01801), Genting Xinyao (01952), and BeiGene (BGNE US/06160/688235 CH), all of which gave purchase ratings. The bank is firmly optimistic about Changpo's heavy snow potential in the mainland biotechnology sector. Companies in the sector with strong self-research capabilities, significant pipeline layout differentiation, and strong first-mover advantages in segmented fields are expected to benefit from structural advantages such as policies and accelerated overseas travel in the long term, and are expected to challenge global giants while maintaining the leading position in the mainland.