WuXi AppTec (603259 CH/2359 HK) [Correction] A/H: Buy/Buy: Improved growth prospects for 2026

Research evidence excerpt

27 March 2026

Equity Research Report

WuXi AppTec (603259 CH/2359 HK)

Equities

Pharmaceuticals

[Correction] A/H: Buy/Buy: Improved growth

prospects for 2026

China

◆ 2026 growth guidance beat our expectation on solid backlogs

◆ Green shoots seen in early stage business

◆ Maintain Buy on WuXi AppTec-A/H and cut target prices to

RMB131.50/HKD136.60 (from RMB145.50/HKD146.70)

Higher-than-expected revenue growth guidance for 2026: WuXi AppTec released

its 2025 annual report, with revenue/ adjusted NP up 16%/41% y-o-y, while backlog

of RMB58bn was up 29% y-o-y. The company guided 18-22% y-o-y revenue growth

for its continuing operation business in 2026, which beats our previous expectation of

17.5%. We turn more optimistic on WuXi AppTec’s growth prospects following the

results and raise our 2026-27 adjusted NP estimates to factor in: (1) solid backlog

addition and top-line growth guidance; and (2) resilient margin on improvement in

revenue mix and the lean operation capability. Supported by solid fundamentals,

WuXi AppTec’s A/H-share price have outperformed the market YTD (up 3%/15%,

respectively vs. CSI 300/HSI down 3%/2%). Trading at c1SD below historical

average PE valuation, we think WuXi AppTec’s A/H-shares are undervalued and the

solid new order addition trend could serve as a potential near-term catalyst.

Improved growth prospects for small molecule CDMO and early stage

businesses: The CDMO business maintained strong growth momentum in 2025 with

small molecule CDMO growing 11% y-o-y and we expect the growth to further

accelerate in 2026, supported by strong demand and global capacity expansion with

RMB6.5-7.5bn planned CapEx in 2026 (source: company data). The early stage

WuXi Testing and WuXi Biology businesses both recorded c5% growth in 2025. We

expect such growth to also accelerate in 2026 driven by double digit growth in new

orders booked in 2025.

A: MAINTAIN BUY

TARGET PRICE (CNY)

PREVIOUS TARGET (CNY)

131.50

145.50

SHARE PRICE (CNY)

UPSIDE/DOWNSIDE

93.68

+40.4%

(as of 24 Mar 2026)

H: MAINTAIN BUY

TARGET PRICE (HKD)

PREVIOUS TARGET (HKD)

136.60

146.70

SHARE PRICE (HKD)

UPSIDE/DOWNSIDE

113.60

+20.2%

(as of 24 Mar 2026)

MARKET DATA

BBG / RIC(A / H)

…