药明合联CMO业务预计2027年首秀 BioDlink整合顺利

China (PRC) | Life Science Tools & DiagnosticsWuxi XDC CMO Debut Expected in 2027; BioDlinkIntegration on Track Duality/BNTX’s HER2 ADC is expected to be the first revenue-generatingmanufacturing project in 2027, validating its commercial capabilities andsupporting future global pharma partnerships. Singapore GMP releaseremains on track for Jul-2026. BioDlink integration on track to alleviateDP capacity constraints. We fine-tuned our model to reflect the businessupdate. With this note, primary coverage transfers to Bingyu Chen. Manufacturing capacity to validate commercial credibility- Duality/BioNTech’s HER2 ADC isexpected to be the first revenue-generating manufacturing project in 2027, with managementguiding for potential peak sales of US$1-2bn. Company expects this project to serve asa validation of WuXi XDC’s commercialization capabilities. Meanwhile, the upcoming FDAinspection of its Wuxi facility should further strengthen its execution at commercial scale andreinforce its regulatory track record. Per sac-TMT, management noted they are keeping activedialogue with Merck. Company expects 3–4 BLA submissions annually. Commercial revenueis not yet incorporated in our current forecast of +30% 2027-2028 revenue growth. Singapore site ready for GMP release; stable margin guided -Construction and validationremain on track, with mAb and DS GMP release targeted for July 2026 and DP to follow later,representing XDC’s potential overseas first FDA inspection and commercial hub. Managementexpects GPM to remain stable at ~36% in 2026, supported by higher utilization rate and lower-than-expected labor costs, offsetting D&A impact. BioDlink integration on track; continued capex investment for global demands- BioDlink wasconsolidated since April 1, but would make modest 2026 top-line contribution to XDC givenits CDMO revenue scale was only RMB235mn last year. WuXi XDC is leveraging the BioDlinkacquisition to address capacity constraints, with drug product capacity expected to increasefrom ~16mn vials to ~24mn vials. Beyond M&A, XDC is accelerating organic expansion withRmb3.1bn capex in 2026 (including Rmb1.7bn for Suzhou/BioDlink, Rmb0.5bn for Singapore,and Rmb0.9bn for other China sites); meanwhile, reiterating their Rmb8bn investment plan by2030 to scale up payload/linker capacity and more overseas expansions. Implication- We lowered our 2026 revenue forecast by 3% to reflect the impact of foreignexchange fluctuations, in line with the guidance of +35% 2026 revenue growth (USD terms),and increased financial expenses to incorporate the financing costs associated with theBioDlink acquisition. Meanwhile, we raised our long-term revenue forecasts to account forthe anticipated ramp-up in commercial manufacturing revenue. We maintain Buy with TPunchanged at HK$80.0. We transfer the coverage to Bingyu Chen. Bingyu Chen * | Equity Analyst+852 3767 1346 | bingyu.chen@jefferies.com Cui Cui, CFA * | Equity Analyst+852 3767 1228 | cui.cui@jefferies.com David Shang * | Equity Analyst+852 3743 8017 | david.shang@jefferies.com Hongda Zhong * | Equity Analyst+852 3767 1311 | hongda.zhong@jefferies.com Jing Ma, Ph.D. * | Equity Analyst+852 3767 1277 | jing.ma@jefferies.com The Long View: Wuxi XDC Investment Thesis We rate Wuxi XDC Buy, as 1) it is the fastest-growing segment underthe Wuxi Group umbrella in a favorable competitive landscape; 2) itssmall-scale batches offer better flexibility and expertise to clients; 3) thecompany's Singapore site targets to reach 30-35% of total capacity by 2026,catering to various customer needs. Downside Scenario,HK$40, -35% Upside Scenario,HK$100, +62% Base Case,HK$80, +30% Higher-than-expected number of new integratedprojects every year and/or ASP increase fromprojectprogression/more technical servicesprovided. Lower-than-expected number of new integratedprojects every year and/or lower ASP decreasefrom competition. Company continues to help clients advance drugcandidates. Has 35-40 new integrated projects every year. Pipeline delay/failure.Slower-than-expected capacity expansion.Downside PT of HK$40 based on DCF valuation. Key assets are approved and commercializedglobally. Keyassets and other assets are approvedand commercialized globally, offering CMO androyalties/milestone revenue streams. PT of HK$80 based on DCF valuation. Upside PT of HK$100 based on DCF valuation. Catalysts Sustainability Matters Top Material Issues:1) Corporate Governance, 2) Business Ethics and Compliance, 3) InformationSecurity, 4) Intellectual Property Protection, 5) Product Safety and Quality, 6) Superior DeliveryCapabilities, 7) Technology and Innovation, 8) Supply Chain Management, 9) Climate Change, 10)Energy Management and GHG Emissions. +New product line on DS/DP capacity expectedto commence operation– 2025 onward+Potential BLA submission for 9 PPQ (processperformance qualification) projects– 2025 Company Targets:1) Reduce greenhouse gas emission intensity by 50% (tons/RMB10,000)