Hansoh delivered strong FY25 results, with total revenue reaching RMB15.03bn (+22.6% YoY) and attributable net income of RMB5.56bn (+27.1% YoY). Product sales grew 20.8% YoY to RMB12.91bn. Excluding collaboration revenues, innovative drug sales surged 29.5% YoY to RMB10.24bn, successfully beating management’s target of RMB10bn. Operating efficiency improved significantly as the SG&A-to-sales ratio fell to 36.7% (vs 42.2% in FY24). Concurrently, R&D investments rose 24.3% YoY to RMB3.36bn. With nearly 20 Ph3 trials planned or ongoing in 2026, we anticipate elevated R&D spending, which should continue to fuel sustainable business development (BD) income. Thanks to the continuous R&D investment, we believe the Company’s BD income will become sustainable in the future. We maintain our BUY rating with a target price of HK$46.41.
Sustainable global out-licensing. Hansoh recorded BD income of RMB2.12bn in FY25, primarily driven by upfront and milestone payments from MSD and GSK. Since late 2023, the Company has successfully outlicensed multiple assets—including B7-H3 and B7-H4 ADCs to GSK, an oral GLP-1 to MSD, a GLP-1/GIP to Regeneron, and a CDH17 ADC to Roche. Supported by a highly productive R&D engine, we view out-licensing as a recurring profit center. In FY25 alone, eight new assets entered the clinic, including a BTK inhibitor, EGFR/c-Met ADC, and KRAS G12D inhibitor, ensuring continuous global BD optionality.
Innovative clinical pipeline advancing on track. Hansoh’s key late-stage assets are progressing rapidly in collaboration with its partners. HS-20093 (B7-H3 ADC) is advancing through global/China Ph3 trials for 2L SCLC and a China Ph3 for osteosarcoma, with domestic BLAs expected in 2026. A China Ph3 of HS-20093 in pre-treated nsq-NSCLC has also been initiated recently by Hansoh. Furthermore, HS-20089 (B7-H4 ADC) entered Ph3 for ovarian cancer in China, while partner GSK registered two global Ph3 studies in ovarian and endometrial cancers. In the metabolic space, MSD advanced HS-10535 (oral GLP-1) into obesity trials, and HS-20094 (GLP- 1/GIP) is in a Ph3 obesity trial in China alongside Regeneron's US Ph2 study.
Aumolertinib sales bolstered by indication expansion. We project strong continued growth for flagship asset aumolertinib, driven by 1L NSCLC market share gains and new regulatory approvals. In early 2026, it secured two additional NRDL inclusions for adjuvant and maintenance therapy in locally advanced EGFRm NSCLC, becoming the first domestic EGFR-TKI approved for these settings. Additionally, its combination with chemotherapy for 1L NSCLC was approved in early 2026. Further commercial upside is supported by a Feb 2026 sNDA submission for a combo with c-Met inhibitor HS-10241 in 2L EGFRm NSCLC, alongside ongoing Ph3 evaluations with an EGFR/c-Met bsAb in 1L NSCLC.
Maintain BUY. We expect Hansoh’s revenue to grow 11.1%/5.6% YoY in FY26E/27E, with net profit to increase by 3.6%/1.85 over the same periods, respectively. Factoring in the strong product sales, we raise our TP from HK$45.26 to HK$46.41 (WACC: 8.13%, terminal growth rate: 4.5%).