Understanding the Market | Concept stocks related to CRO collectively decline, short-term industry pressure still exists, industry consolidation is expected to increase the market share of leading companies
Concept stocks related to CRO collectively declined. As of the time of publication, Pharmaron fell by 3.22% to HKD 8.73, WuXi AppTec fell by 3.04% to HKD 30.25, and Tigermed fell by 2.84% to HKD 29.05. WanLian Security pointed out that the adjustment in the CXO industry in the past two years is partly due to the industry moving past its initial high-growth period. On the other hand, the global innovative drug sector is experiencing valuation compression in a rising interest rate environment, which is being transmitted upstream to the research and development outsourcing industry. From the perspective of the innovation cycle, corporate performance is releasing to digest valuations, while the pessimistic expectations at the bottom of the cycle are fully reflected in valuations. The industry's cyclical bottom features are evident, and the overall sector outlook only needs to await the arrival of a new round of the innovative drug cycle. Xiangcai Securities pointed out that the pharmaceutical outsourcing industry faces certain short-term pressures due to the high base of new crown drug CDMO and the decline in pharmaceutical investment and financing. The slowdown in personnel and capacity expansion is conducive to capacity digestion, and industry consolidation is conducive to further increasing the market share of leading companies
According to the Wise Finance APP, the concept stocks of CRO collectively declined. As of the time of publication, Pharmaron (03759) fell by 3.22% to HKD 8.73; WuXi AppTec (02359) fell by 3.04% to HKD 30.25; Tigermed (03347) fell by 2.84% to HKD 29.05.
WanLian Security pointed out that the adjustment in the CXO industry in the past two years is partly due to the industry having passed the initial high-growth period. On the other hand, the valuation of global innovative drugs is under pressure in a rising interest rate environment, which is transmitted upstream to the research and development outsourcing industry. From the perspective of the innovation cycle, corporate performance releases digest valuations, while the pessimistic expectations at the bottom of the cycle are fully reflected in valuations. The characteristics of the industry cycle bottom are obvious, and the overall sector market only needs to wait for a new round of the innovative drug cycle to arrive.
Xiangcai Securities pointed out that the pharmaceutical outsourcing industry faces certain short-term pressure due to the high base of CDMO for COVID-19 drugs and the decline in pharmaceutical investment and financing. The expansion of personnel and production capacity has slowed down, which is conducive to capacity digestion. Industry consolidation is conducive to further increasing the market share of leading companies