CCB International expanded the adjusted net loss forecast for Rongchang Biotech (09995) in 2024 from a loss of 1.3 billion yuan to a loss of 1.4 billion yuan.
The Zhitong Finance App learned that CCB International released a research report stating that while maintaining Rongchang Biotech's (09995) “outperforming the market” rating, the target price was raised by 30.8% from HK$26 to HK$34. The company's 2023 results were basically in line with expectations, and the fourth quarter of 2023 results exceeded CCB's expectations. Overall net losses for the fourth quarter of 2023 and 2023 reached 1.5 billion yuan (same below) and 481 million yuan respectively. Excluding equity incentive costs, net losses would be $1.4 billion and $365 million respectively, which is less than anticipated.
The bank said Rongchang Biotech plans to issue A shares to cover R&D expenses. On April 2, 2024, Rongchang Biotech announced the issuance of no more than 70.8 million new A-shares to 35 target subscribers. It also believes that Rongchang Biotech has been expanding its hospital coverage through marketing strategies targeting doctors, which has led to more widespread adoption of more indications by local doctors. In view of this, CCB expanded the company's adjusted net loss forecast for 2024, from a loss of 1.3 billion yuan to a loss of 1.4 billion yuan, and the forecast loss for 2025 from 610 million yuan to 955 million yuan.