On Tuesday, A-shares in Hk saw a collective celebration in the Biomedical and CRO Concept.

Among them, WUXI APPTEC hit the upper limit during trading at 70.43 yuan, reaching a new high since January 2024, with a total market value of 201.8 billion yuan.

As of the time of writing, WUXI APPTEC has retraced to 9.56%, while SHENGNUO BIO has risen more than 5%, Asymchem Laboratories, Joinn Laboratories, and PHARMARON have all followed with gains.

WUXI APPTEC on the Hong Kong stock market once rose over 16% to 76 HKD, marking a new high since January 2024, and is currently up more than 11%; WUXI XDC has increased over 9%, WUXI BIO is up more than 5%, GENSCRIPT BIO and TIGERMED both rose over 4%.

After experiencing a significant震荡, the Biomedical sector has continued to rise this year.

The A-shares in Hk CRO Concept has accumulated over an 18% increase this year, while the Hong Kong biomedical Sector has accumulated over a 40% increase this year.

The leading CRO has released a signal.

Last night, WUXI APPTEC released an impressive performance report and announced a 1 billion yuan buyback, signaling a fundamental reversal to the market.

The company not only exceeded operational goals last year, but also set a new high in quarterly revenue in Q4.

The Earnings Reports show that in 2024, the company achieved revenue of 39.241 billion yuan, a year-on-year decrease of 2.73%; the Net income attributable to the shareholders of the listed company was 9.45 billion yuan, a year-on-year decline of 1.63%.

Although WUXI APPTEC's performance in 2024 shows an overall 'double drop', it actually exceeded market expectations significantly.

This is because in the 2023 Earnings Reports, the company projected revenue in 2024 to reach 38.3-40.5 billion yuan, and after excluding certain commercialization production projects, it will maintain positive growth (with a projected growth rate of 2.7-8.6%).

Excluding last year's COVID-19 commercialization projects, the revenue for 2024 increased by 5.2% year-on-year.

In the meantime, revenue has achieved three consecutive increases on a quarterly basis this year. Revenue in the fourth quarter rose to 11.54 billion yuan, a quarter-on-quarter growth of 10.31%, strongly surpassing the single-quarter revenue peak set in the fourth quarter of 2022.

In addition, WUXI APPTEC's TIDES business sector is expected to see a year-on-year revenue growth of 70.1% in 2024, reaching 5.8 billion yuan, far exceeding the previously provided annual growth guidance of 60%.

With the rapid recovery of core business, the company expects revenue to return to double-digit growth in 2025, with an increase of between 10%-15%, while overall revenue is set to reach between 415 and 43 billion yuan.

To enhance investor confidence, WUXI APPTEC also plans to invest 1 billion yuan in share buybacks and pay dividends.

The company declared a final dividend of 9.8169 yuan for every 10 shares, and also proposed a special dividend of 3.5 yuan for every 10 shares. At the same time, it plans to use 1 billion yuan to repurchase shares, with a repurchase price not exceeding 92.05 yuan per share (inclusive).

Investment banks are generally bullish.

In the past year, the Biological Safety Act proposed by the USA has continued to disrupt the Biomedical market.

Among them, the stock prices of CRO companies such as WUXI APPTEC, which have a high revenue share in the USA, have experienced several wild fluctuations.

Although the bill did not successfully pass last year, concerns about uncertainty have continued to loom.

In the latest earnings conference call, WUXI APPTEC responded to the subsequent 'Biological Safety Act' by stating that it will closely monitor legislative developments in the new Congress in the USA.

Additionally, regarding the USA's tariff policy, WUXI APPTEC stated that tariffs are a global uncertainty, not targeting any particular country, and the specific impact of tariffs on the company's business is not very clear and needs further observation.

As Q4 returns to the growth Range, WUXI APPTEC's core business is recovering rapidly, also sending signals to the market, and investment banks are generally Bullish.

Nomura stated that WUXI APPTEC's performance in 2024 roughly meets expectations, with the TIDES business remaining a growth driver. Revenue in the fourth quarter of 2024 is expected to increase by 6.9% year-on-year to 11.5 billion yuan.

The firm expressed confidence in the group's optimistic prospects before 2025, raising the Target Price by 3.5%, from 81.7 HKD to 84.59 HKD.

UBS Group indicated that WUXI APPTEC's last quarter earnings report exceeded expectations and launched an H-share incentive program, raising its Target Price from 70.4 to 80.2 yuan, corresponding to a projected PE of 18 times this year, maintaining a 'Buy' rating.

Morgan Stanley stated that WUXI APPTEC's revenue and adjusted Net income margin last year and in the last quarter met the bank's expectations. The guidance for this year is also within expectations, with the adjusted Net income margin expected to improve further. The strong backlog growth from last year is expected to support a rebound in growth by 2025. The fundamentals remain strong, and a further revaluation by the market is achievable. The investment rating is maintained at 'Shareholding' with a Target Price of 74.3 yuan.