Citi has reiterated its "Buy" rating on SBP GROUP (01177), raising the target price from HK$10 to HK$10.8 following the company's better-than-expected first-half results.

The pharmaceutical firm reported a 1.4% year-on-year increase in net profit to RMB 3.44 billion for the period, significantly exceeding both market consensus and Citi's own forecasts. Revenue for the first half grew 10.6% year-on-year to RMB 19.44 billion, also surpassing expectations, driven largely by a robust 44.3% surge in innovative drug sales, which reached RMB 8.79 billion. Management projects that innovative drugs will account for approximately 50% of full-year revenue.

Citi noted that excluding a RMB 1.35 billion after-tax dividend from Sinovac Life Sciences in H1 2025, adjusted net profit would have climbed a substantial 92.3% year-on-year. Looking ahead, the group's management expects to launch more than 30 innovative drugs between 2026 and 2030, with peak domestic sales potential estimated at RMB 50 billion.