"Hanmi Pharmaceutical: Beijing Hanmi's Recovery Key in H2... Target Price Lowered" [Click e-Stock]

DB Financial Investment Lowers Target Price for Hanmi Pharmaceutical to 570,000 Won

On July 29, DB Financial Investment revised down its earnings forecast for Hanmi Pharmaceutical through next year, lowering its target price from 630,000 won to 570,000 won, while maintaining its "Buy" investment rating.

On July 29, Myungseon Lee, a research analyst at DB Financial Investment, stated, "We have revised down Hanmi Pharmaceutical's earnings outlook until 2027, but the expectations for the domestic launch of efeglenatide and the upcoming liver biopsy results from clinical trials of epinopegdutide and eposipegtrutide, both candidates for treating metabolic dysfunction-associated steatohepatitis (MASH), remain valid."

In the second quarter, Hanmi Pharmaceutical reported provisional results of 467.2 billion won in sales (up 29.3% year-on-year) and 131.1 billion won in operating profit (up 115.2% year-on-year), both of which beat market expectations.

On a separate basis, operating profit reached 128.7 billion won (up 31.6% year-on-year), due to the one-time recognition of upfront payments from the Eli Lilly contract. Hanmi Fine Chemical also remained profitable, supported by high-margin contract manufacturing (CMO) sales. However, Beijing Hanmi's operating profit was limited to 600 million won due to seasonal off-peak factors and intensified impact from the volume-based procurement system.

DB Financial Investment expects Beijing Hanmi's recovery in the second half of the year to be a key indicator. The firm has revised down its estimates for Hanmi Pharmaceutical's full-year 2024 performance, expecting sales of 1.628 trillion won (from the previous 1.7193 trillion won) and operating profit of 309.3 billion won (from the previous 323.2 billion won).

Lee added, "Standalone and Hanmi Fine Chemical's performances are expected to remain robust." However, he lowered projections for Beijing Hanmi, stating, "In spite of efforts to expand market share within the competitive volume-based procurement category and actively develop non-procurement products, past examples suggest that such challenges are unlikely to be resolved in a short period." He further noted, "It will also take time to resolve the exclusive distribution structure for over-the-counter medicines."

DB Financial Investment also lowered its forecast for next year, expecting sales of 1.6312 trillion won and operating profit of 261 billion won, both revised downward from previous estimates.

This content was produced with the assistance of AI translation services.