CICC: Maintains ABBISKO-B outperforming industry rating and raises target price to HKD 20

According to the Zhitong Finance APP, China International Capital Corporation (CICC) released a research report stating that it maintains the forecast for HeYu-B (02256) net profit attributable to the parent company at RMB 48 million for 2025 and RMB 320 million for 2026. Considering the smooth progress of the R&D for ABSK043 and the upward adjustment of industry valuation, the firm maintains an outperform rating for the industry. Based on the DCF model, it raised the target price by 33.3% to HKD 20.0, indicating an upside potential of 18.3% compared to the current stock price. CICC's main points are as follows: Company Update Recently, the company announced that the IND application for the oral PD-L1 inhibitor ABSK043 and the KRAS G12C inhibitor Goretinib from Eli Lilly for the treatment of KRAS G12C mutated NSCLC has been approved in China. Additionally, the company has recently been included in the MSCI Global Small Cap Index constituents. ABSK043 is a potential oral small molecule PD-L1 inhibitor with global rights According to the company's announcement, ABSK043 is an oral small molecule PD-L1 inhibitor with good bioavailability and high selectivity. Although several PD-1/PD-L1 monoclonal antibodies have been approved globally, there has yet to be an orally bioavailable PD-1/PD-L1 approved. According to the company's announcement, Phase I study results show that ABSK043 has good safety and anti-tumor activity as a monotherapy. ABSK043 combined with Goretinib enters Phase II clinical trials, continuing to explore the potential of oral + oral combination therapy In March 2025, the company reached a cooperation agreement with Eli Lilly regarding ABSK043. The approval is for a Phase II clinical trial evaluating the combination of ABSK043 and Eli Lilly's KRAS G12C inhibitor Goretinib for the treatment of KRAS G12C mutated NSCLC. Previously, both parties also explored the combination of ABSK043 and Eli Lilly's Furmonertinib for the treatment of advanced NSCLC. The firm believes that the company's ongoing layout of oral + oral combination therapy is expected to have better patient compliance and safety profile compared to injection + oral combination therapy, and subsequent clinical progress is worth paying attention to. Inclusion in the MSCI Global Small Cap Index is expected to enhance visibility and liquidity On August 13, the company announced that based on the latest MSCI index review results published in August, the company has successfully been included in the MSCI Global Small Cap Index constituents due to its innovation capabilities and commercialization progress. This adjustment officially took effect after the market close on August 26, 2025. The firm believes that being included in this index is expected to enhance the company's global funding visibility and may positively impact liquidity