| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 51.01 | -12 |
| Intrinsic value (DCF) | 21.89 | -62 |
| Graham-Dodd Method | 9.17 | -84 |
| Graham Formula | 29.75 | -49 |
Jiangsu Hengrui Medicine Co., Ltd. is a leading Chinese pharmaceutical company founded in 1970 and headquartered in Lianyungang, China. As a prominent player in the global drug manufacturing sector, Hengrui Medicine specializes in researching, developing, manufacturing, and commercializing innovative medicines worldwide. The company maintains a robust pipeline targeting oncology, metabolic disorders, pain management, autoimmune diseases, and other critical therapeutic areas. Key developmental assets include breakthrough treatments such as Camrelizumab, Apatinib, Pyrotinib, and multiple novel biologic candidates. With a market capitalization exceeding CNY 438 billion, Hengrui represents China's growing presence in the global pharmaceutical innovation landscape. The company's integrated approach from research to commercialization positions it as a significant contributor to healthcare advancement, particularly in developing cutting-edge cancer immunotherapies and targeted treatments that address unmet medical needs across global markets.
Jiangsu Hengrui Medicine presents a compelling investment case as China's leading innovative pharmaceutical company with strong financial metrics including CNY 27.98 billion in revenue, CNY 6.34 billion net income, and robust operating cash flow of CNY 7.42 billion. The company's minimal debt (CNY 69 million) against substantial cash reserves (CNY 24.82 billion) provides financial flexibility for continued R&D investment. However, investors should consider regulatory risks in both domestic and international markets, patent cliffs for existing products, and intense competition in the oncology space. The company's beta of 0.386 suggests lower volatility than the broader market, potentially appealing to risk-averse investors seeking exposure to China's growing pharmaceutical innovation sector. The dividend yield, while modest, complements total return potential driven by pipeline advancements and market expansion.
Jiangsu Hengrui Medicine has established a strong competitive position through its dual focus on innovative drug development and generics manufacturing. The company's primary competitive advantage lies in its extensive R&D pipeline featuring novel oncology assets, particularly its PD-1 inhibitor Camrelizumab and various targeted therapies. Hengrui benefits from lower R&D costs compared to Western counterparts while maintaining high scientific standards, allowing efficient innovation. The company's vertically integrated operations from research to commercialization provide cost advantages and quality control. However, Hengrui faces intensifying competition from both domestic Chinese pharmaceutical companies accelerating their innovation capabilities and multinational corporations expanding in China. The company's transition from generics to innovative drugs represents both an opportunity and vulnerability, as success depends on clinical trial outcomes and regulatory approvals. Hengrui's strong cash position enables sustained R&D investment, but the increasingly crowded PD-1/L1 inhibitor market requires differentiation through combination therapies and novel targets. The company's domestic market dominance provides a stable revenue base while international expansion remains challenging against established global players with deeper commercial infrastructure.