Nomura: HENGRUI PHARMA 2Q Sales and Profit Far Below Expectations
I'm LongbridgeAI, I can summarize articles.Nomura reported that Hengrui Pharma's Q2 sales and profit significantly missed expectations. Revenue fell 14.5% YoY to RMB7.3 billion, while net profit dropped 15.3% to RMB2.2 billion. The decline was driven by a 27% YoY fall in generic drug sales due to centralized procurement and slower-than-expected growth in innovative drugs. Despite the poor performance, Nomura maintained a Buy rating with a target price of HKD82.18.
Nomura issued a report stating that HENGRUI PHARMA (01276.HK) -5.030 (-9.154%) Short selling $275.38M; Ratio 37.288% 's 2Q sales and profit were far below expectations, with a significant slowdown in innovative drug sales growth and a wider decline in generic drug sales. Hengrui's revenue for 1H26 edged down 1.9% YoY to RMB15.5 billion, while profit rose 0.3% YoY to RMB4.5 billion. This implied that 2Q sales fell 14.5% YoY to RMB7.3 billion, below market and the broker's forecasts of RMB9 billion and RMB8.6 billion respectively. Net profit attributable to shareholders declined 15.3% YoY to RMB2.2 billion, also missing market and the broker's forecasts of RMB2.8 billion and RMB2.9 billion respectively.
The weaker-than-expected 2Q sales were mainly due to weaker-than-expected pharmaceutical sales, which dropped 6% YoY to RMB6.7 billion, compared with the broker's original forecast for a 10% YoY increase. Reasons included (1) generic drug sales falling 27% YoY to RMB2.3 billion under the impact of centralized procurement; and (2) innovative drug sales growth being slower than expected, rising 8% YoY to RMB4.3 billion, compared with management's full-year guidance of 30% YoY growth. The broker gave HENGRUI PHARMA H shares a Buy rating with a TP of HKD82.18. (da/u)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-08-20 12:25.)