Goldman Sachs gives SINO BIOPHARM a "Buy" rating with a target price of 6.19 yuan

Goldman Sachs published a research report, giving China Biologic Products Holdings (01177.HK) a "Buy" rating with a target price of HKD 6.19. This target price is based on a 12-month sum-of-the-parts valuation method, where the discounted cash flow method values the innovative drug pipeline at RMB 69.3 billion, while the generic drug business is valued at RMB 46.8 billion based on a 12 times price-to-earnings ratio and a five-year average compound growth rate of 5%.

China Biologic Products announced the acquisition of 100% equity in Hejia for a total price of RMB 1.2 billion, of which approximately RMB 1.1 billion will be paid in cash, and the remaining RMB 97 million will be paid in installments in the form of new shares. Hejia is a clinical-stage biotechnology company focused on siRNA technology, currently having four clinical-stage projects targeting Lp(a), ApoC3, THRbeta, and HBV, and has more than ten preclinical candidate products.

This is the third acquisition by China Biologic Products in two years. Goldman Sachs believes that as siRNA technology gradually becomes an important innovative model for chronic disease treatment, this acquisition will strengthen China Biologic Products' research and development pipeline in the fields of cardiovascular, metabolic, and liver diseases, creating synergies with its existing products