Yamato: First coverage of Pharmaron Beijing (03759) with a "buy" rating, target price of HKD 25.5.

Daiwa has released a research report stating that it has initiated coverage on Pharmaron Beijing (03759) H shares with a "buy" rating and a target price of HK$25.5. The firm believes that Pharmaron Beijing is benefiting from the recovery of global biopharmaceutical financing and the continued outsourcing demand from multinational pharmaceutical and biotechnology clients. The company's laboratory business is maintaining robust growth momentum, and with strong growth in new orders in the first quarter, it is expected that revenue in this segment will grow by 13 to 15% from 2026 to 2028; Meanwhile, the CMC business is moving towards commercialization and is expected to become a key growth driver in the short to medium term, with a compound annual growth rate of 24% expected from 2026 to 2028. The firm stated that due to Pharmaron Beijing's growth in new orders exceeding 30% year-on-year in the first quarter, coupled with solid performance in the first quarter, it believes that the company can achieve the guidance of a 12% to 18% year-on-year revenue growth in 2026.