Morgan Stanley: WUXI XDC (02268) reiterates full-year revenue growth target of 40%, maintains "Overweight" rating.

Morgan Stanley released a research report stating that WUXI XDC (02268) management reiterated its full-year revenue growth target of 40% at constant exchange rates, including the contribution from BioDlink. The bank maintains its "Overweight" rating on the company with a target price of HK$85. Morgan Stanley noted that WUXI XDC disclosed a licensing agreement with Ona Therapeutics for its WuXiTecan-2 Payload-Linker platform to develop ADC drugs targeting an undisclosed target. The bank expects the deal to further increase WUXI XDC's milestone backlog orders. As of the first half of this year, total backlog orders, standalone backlog orders, and service backlog orders excluding milestones reached US$2.2 billion, US$2.1 billion, and US$2.0 billion, respectively, representing year-over-year increases of 62.2%, 57.9%, and 50.4%. The bank believes that the U.S. Food and Drug Administration's on-site inspection of the Wuxi facility is expected to take place as early as January or February 2027. If successfully passed, it will be key to establishing a regulatory track record and securing more commercial orders from multinational pharmaceutical companies.