Guolian Minsheng: Maintain "Buy" rating on WUXI XDC (02268), raise company profit forecast.

Guolian Minsheng released a research report stating that WUXI XDC (02268), as the leading company in the global ADC CXO industry, is expected to consolidate its industry leading position with its leading technological capabilities and product delivery quality in the context of the overall rapid expansion of the industry. Considering the company's focus on the high-growth ADC CXO track, with a sharp increase in hand orders year-on-year in 25H1 and orderly release of reserve capacity, the bank has raised its profit forecast for the company. The bank expects the company's revenue for 2025-2027 to be 5.99/8.24/10.51 billion yuan respectively, with year-on-year growth rates of +47.7%/+37.7%/+27.5%; net profit attributable to shareholders will be 1.51/2.06/2.67 billion yuan respectively, with year-on-year growth rates of 41.5%/36.2%/29.4%. The EPS will be 1.23/1.68/2.17 yuan respectively. The bank maintains a "buy" rating. Guolian Minsheng's main points are as follows: Event In the first half of 2025, the company achieved revenue of 2.7 billion yuan (up 62.2% year-on-year), gross profit of 980 million yuan (up 82.2% year-on-year), adjusted net profit (excluding interest and expenses) of 730 million yuan (up 69.6% year-on-year), adjusted net profit (including interest income and expenses) of 800 million yuan (up 50.1% year-on-year), and net profit of 750 million yuan (up 52.7% year-on-year). Abundant orders empower steady growth in performance, outstanding capabilities in high-growth tracks As of 2025H1, the company's outstanding orders amounted to 1.33 billion US dollars (up 57.9% year-on-year), with the amount of new contracts increasing by 48.4% year-on-year (the highest growth rate in North America, further highlighting the company's industry competitiveness in the context of global trade policy fluctuations). According to performance briefings, the global ADC market reached 13.2 billion US dollars in 2024 (a compound annual growth rate of 34.0% from 2020 to 2024), and it is expected to rapidly reach 66.2 billion US dollars by 2030 with a compound annual growth rate of 30.8% (about 60% outsourcing rate from 2024 to 2030). In the high-growth emerging ADC outsourcing services track, the company's market share has increased from 9.9% in 2022 to 22.2% in 2025H1, continuously solidifying its industry leading position (the company's cooperation rate with the top 20 global pharmaceutical companies is 13/20). The project funnel model continues to expand, and capital expenditures are expected to break through existing growth heights Under the "empower-follow-win molecules" strategy, the company signed 37 new iCMC projects (including 13 winning molecule projects) and added 3 PPQ projects in 2025H1, maintaining a steady expansion trend in the comprehensive collaboration project funnel model. In order to meet the growing outsourcing demand of global customers, the company is expected to invest 1.56 billion yuan in capital expenditures in 2025 (about 900 million yuan in Singapore and about 4.5 billion yuan in Wuxi), and the total capital expenditures are expected to exceed 7 billion yuan by 2029, including new production capacity for coupling liquids, coupling agents, and payload linkers. The company has already started the expansion work at the Wuxi and Shanghai bases, as well as the design planning for the new Jiangyin base. Risk warning: Intensified industry competition, market demand below expectations, geopolitical risks, and capacity expansion falling short of expectations.