WUXI BIO is selling the Irish vaccine facility to Merck for 0.5 billion USD, a price close to its total construction cost of 0.48 billion USD. The company indicated that the ROI is the main consideration behind this Trade. Morgan Stanley's report stated that since the asset's ROI for WUXI BIO is below target, according to WUXI APPTEC management's perspective, the Trade seems to be a win-win for both parties. The other operations of the company's Irish facilities remain unchanged, with a stable gross margin of about 40%. Regarding the use of Cash, WUXI APPTEC will further repurchase shares and make higher-yielding investments. As the ROI is performing well, there are currently no other assets that need to be sold. Morgan Stanley pointed out that although the asset sale will sacrifice WUXI BIO's short-term income, this Trade is expected to have a positive impact on the company's profitability, ROI, and cash usage efficiency, thus reaffirming WUXI BIO's 'Shareholding' rating with a Target Price of 31.6 HKD.
大摩：重申药明生物“增持”评级 出售爱尔兰疫苗设施对盈利能力和资金运用正面
Morgan Stanley: Reiterating WUXI BIO's 'Shareholding' rating. The sale of the Irish vaccine facility positively impacts profitability and capital utilization.
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