Hutchison China MediTech


£2366m market cap

361.5p last close

Hutchison China MediTech (HCM) is an innovative China-based biopharma company targeting the global market for novel, highly selective oral oncology and immunology drugs. Its established China Healthcare business is growing ahead of the market. HCM is the healthcare arm of CK Hutchison (c 40% listed on AIM and NASDAQ).

Investment summary

Hutchison China MediTech (HCM) continues to make progress towards its global strategic aspirations. The interim results highlight the opportunities for Elunate (fruquintinib) capsules in China, with potential inclusion in China’s exclusive NRDL list in Q419, and the breadth of clinical and regulatory catalysts that lie ahead for multiple R&D assets. Surufatinib’s China NDA submission is on track (Q419) and approval in NET would seal HCM’s position as a premier, innovative, China-based oncology company. The years 2021–22 are pivotal; partner AstraZeneca (AZN) could launch savolitinib in China for NSCLC (MET exon 14) and it could become HCM’s first asset to launch globally (2022) in combination with Tagrisso for NSCLC (c-Met +ve). Given the recent underperformance of the shares and the real potential for HCM to become a global oncology player, we believe it is appropriate to revisit the shares. We value HCM at $5.7bn.

Y/E Dec
Revenue (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2017A 241.2 (50.7) (53.5) (4.3) N/A N/A
2018A 214.1 (89.0) (86.7) (11.3) N/A N/A
2019E 182.9 (144.8) (147.0) (17.7) N/A N/A
2020E 194.4 (172.4) (178.2) (22.1) N/A N/A
Last updated on 04/07/2019
Industry outlook

HCM’s profitable Chinese healthcare business continues to benefit from the fast-growing domestic market, while the clinical, regulatory and technological environments are highly conducive to novel drug development. In the longer term, if the oncology and immunology pipeline comes to fruition, we expect HCM to become a major Chinese and international oncology company.

Last updated on 04/07/2019
Share price graph
Balance sheet
Forecast net cash (US$m) 163
Forecast gearing ratio (%) N/A
Price performance
Actual (13.2) (25.3) (25.3)
Relative* (14.7) (25.7) (23.2)
52-week high/low 5600.0p/3305.0p
*% relative to local index
Key management
Simon To Chairman
Christian Hogg CEO
Johnny Cheng CFO
Dr Weiguo Su Chief Scientific Officer
Mark Lee SVP, Corporate Fin & Dev.

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