[ET Net News Agency, 23 October 2020] Daiwa Research lowered its target price for CSPC
Pharmaceutical Group (1093) to HK$7 from HK$7.5 and maintained its "sell" rating.
In view of accelerated progress on the injection bioequivalent (BE) test, the research
house expects NBP (25% of 2019 revenue) to be included in the GPO (group purchasing
organization) in 2022.
Daiwa believes an accelerated injection BE review would help to include more injection
drugs in the GPO from 2021. Since NBP's injection patent will expire in 2022, the research
house believes it should be included in the GPO in 2022 right after the expiry.
Daiwa's forecasts call for EPS growth of 14% in 2020, 19% in 2021, and 22% in 2022. It
forecast CSPC's earnings to record only 2.6% growth in 2023 and decline by 2.2% in 2024.
Daiwa said CSPC's pipeline is too weak to sustain its earnings growth post NBP's peak in
2022. (KL)