Sinopharm Group Co Ltd

01099: XHKG (HKG)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
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Sinopharm Earnings: On Track to Meet Our 2024 Target; Valuation Unchanged; Shares Undervalued

Yurou Zheng

Oct 28, 2024

We keep narrow-moat Sinopharm’s fair value estimate unchanged at HKD 23.80 per share following its in-line third-quarter results, with nine-month revenue making up 74.2% of our full-year forecast. We expect 2024 total revenue to be flat at CNY 596.4 billion. We maintain our 2025 revenue growth rate of 4.2%, reflecting a recovery from antigraft campaigns that have constrained industry growth. We think Sinopharm is undervalued. It is currently trading at a price/book ratio of 0.47 and 15% discount to our fair value estimate. We expect China-focused entities such as Sinopharm to be shielded from potential geopolitical upheaval.

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Sinopharm Group Co Ltd

Sinopharm Earnings: On Track to Meet Our 2024 Target; Valuation Unchanged; Shares Undervalued

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