Revenue is steady, and R&D investment has increased dramatically. The company released its semi-annual report for 2023: revenue for the first half of the year was 311 million yuan (up 2% year on year, the following are all year-on-year); net profit to be 328 million yuan, net profit after non-return net profit - 331 million yuan. The year-on-year loss increased, mainly due to a decline in gross margin and a sharp increase in R&D expenses during the period. Sales expenses were 141 million yuan (-3%); management expenses were 55 million yuan (+46%), mainly due to increased employee remuneration and listing related expenses; R&D expenses were 333 million yuan (+92%), and R&D expenses were 107%, an increase of 50 percentage points over the previous year.

B01D1 is expected to be the world's first EGFR/HER3 dual antibody ADC to be marketed. B01D1 is the world's first EGFRXHER3 ADC. A single drug is already in phase II clinical trials. It has completed applications for 3 single-drug dual-arm phase III registered clinical trials and 2 single-arm key registered clinical studies. Its combined use with SIB003, chemotherapy, and ositinib has all obtained phase II clinical approval. Overseas: It was announced on July 2 that the B01D1 clinical trial application has also been approved by the FDA. B01D1 has obtained impressive data on NSCLC treatment and head and neck squamous cell carcinoma, and has appeared at many internationally renowned academic conferences: preclinical data was presented at the AACR conference, phase I data for treating solid tumors was presented in the form of an oral report at the ASCO conference, and updated phase I data on NSCLC treatment will also be presented in an oral report at the ESMO conference.

Differentiated platforms drive innovation and transformation. The company has established an integrated ADC platform. 4 ADCs have entered clinical trials, and BL-M07D1 (HER2), BL-M02D1 (TROP2), and BL-M11D1 (CD33) have all entered Phase I. Multiple drugs incubated on the dual/multi-antibody platform are at the forefront of global progress:

NSCLC treatment with SI-B001 (EGFRXHER3) has entered phase III, and the combined clinical trial of SI-B003 (PD-1XCTLA-4), SI-001, and chemotherapy is already in phase II; GNC-038, etc., are the top 3 clinical antibodies in the world, all in phase I. GNC-035 GNC-039

Profit forecasts and investment recommendations. The company's revenue for 2023-2025 is estimated to be 6.63, 6.26 and 1,539 billion yuan, respectively. Early data on B01D1 is impressive, and we are optimistic about its potential for globalization. Using the DCF valuation method, the reasonable value obtained was 110.70 yuan/share, maintaining the “buy” rating.

Risk warning. Clinical progress falls short of expectations, commercialization falls short of expectations, market competition exceeds expectations, etc.