Open Source Securities: Buy rating for Healthy Yuan

Open Source Securities Co., Ltd.’s Yu Ruyi and Liu Yi recently conducted research on Health Yuan and released a research report titled “Company Information Update Report: Product Structure Continues to Be Optimized, Innovation Drug Pipeline Accelerates,” granting Health Yuan a “Buy” rating.

Health Yuan (600380)

Product structure continues to be optimized, innovation-drug pipeline accelerates; maintaining a “Buy” rating

The company achieved revenue of 1.34B yuan in 2025 (-2.58% year over year; the following are year-over-year comparable figures); attributable net profit to shareholders of 1.31B yuan (-3.68%); and non-recurring items attributable net profit of 7.29B yuan (-0.94%). In 2025, the company’s gross margin was 62.44% (-0.25 pct); net profit margin was 18.83% (-0.27 pct). In 2025, the company’s chemical pharmaceutical formulations revenue was 1.69B yuan (-5.64%), and API intermediates revenue was 1.71B yuan (-5.76%). Traditional Chinese medicine formulations were 1.72B yuan (+14.47%). Diagnostic reagent & equipment were 657 million yuan (-8.56%). Health foods were 516 million yuan (+36.96%). Biologics were 201 million yuan (+17.50%). The revenue share of the company’s respiratory innovative drugs in respiratory-sector revenue has exceeded 25%; the company’s product structure continues to be optimized, and the effectiveness of its innovation-driven transformation is gradually becoming visible. Given that the promotion of the company’s new products still requires time, we lower the company’s attributable net profit for 2026–2028 to 14.01/15.32/17.13 billion yuan (from the prior forecast of 15.68/500M yuan), with EPS of 0.77/0.84/0.94 yuan per share. The current stock price corresponds to PE of 14.6/13.4/12.0x. We believe in the company’s innovation-driven transformation advantages and maintain a “Buy” rating.

Focus on a full respiratory-disease product matrix; R&D innovation delivers breakthroughs in multiple directions

The company’s R&D and innovation deliver breakthroughs in multiple directions, introducing advanced technologies such as OPENCLAW to move AI from assistive decision-making to scenario-based execution. The company’s first Class 1 drug, ma’siprusavir, was approved for commercialization and上市 in 2025, formally realizing commercial execution in the influenza track; the pediatric dry mixed suspension of ma’siprusavir has initiated Phase 3 clinical trials, expanding into the pediatric influenza sub-segment; the TSLP monoclonal antibody has initiated Phase 1 clinical trials, providing a new treatment option for domestic moderate-to-severe COPD. The company’s globally first PREP inhibitors (FIC), MABA inhalation solution, and Nav1.8 inhibitors are steadily progressing in Phase 2 studies; the next-generation ICS has been successfully approved for clinical trials; and the PDE4 inhibitor and DPP1 inhibitor are in preclinical stages. Overseas, the company’s inhalation formulation production line passed the Malaysia PIC/SGMP inspection, earning an “access pass” to international markets. The company also plans to acquire Vietnam IMP pharmaceutical enterprises to further expand its Southeast Asia business footprint; the API plant in Indonesia operated in cooperation with Kalbe has already fully launched Phase 1 earthwork and construction. In addition, the company has continued to pursue cash dividend distribution together with share buybacks to share growth dividends with investors: in 2025, the company repurchased and cancelled nearly 5 billion yuan, and plans to distribute dividends of 2.20 yuan per 10 shares (cash dividend year over year: +10%). With high dividend distribution and buybacks combined with strong innovation-driven transformation capability, the company’s valuation is expected to see further improvement.

Risk warning: risks of industry policy changes, risks related to new drug R&D, risks of raw material supply and price fluctuations, and others.

The latest profit forecast details are as follows:

The above content has been compiled by Securities Star from publicly available information and generated by an AI algorithm (Network Information Security Filing and Record No. 310104345710301240019). It does not constitute investment advice.