Card and Hong Kong stock AI technology empowers scarce racetracks. Insili Intelligence (03696) relies on a top investment lineup to allocate value over a long period of time

In recent years, artificial intelligence (AI) has been moving from “technological breakthroughs” to “all-factor empowerment” at an alarming rate. In the field of AI pharmaceuticals in particular, benefiting from the deep empowerment of AI algorithms and computational capabilities, biomedical research has reached unprecedented speed and accuracy, thus entering a new era of efficiency, personalization, and revolution. An internationally renowned consulting firm, McKinsey predicted in a previous report that AI empowerment is expected to bring economic value of 60 to 110 billion US dollars to the pharmaceutical and medical industries every year.

As a unicorn company with an exclusive AI technology platform that can also achieve innovative drug development and deep empowerment in various fields, Insili Intelligence (03696) has now landed in Hong Kong stocks, bringing a major option for Hong Kong stock investors on the scarce AI-enabled investment circuit.

On December 30, Insili Smart was officially listed and traded on the main board of the Hong Kong Stock Exchange.

The Zhitong Finance App learned that Insili Smart's Hong Kong stock IPO has attracted market attention. On the one hand, the company is expected to raise up to HK$2,277 billion, making it the largest biotech IPO in the Hong Kong market in 2025; on the other hand, in the process of issuing the Innosilicon Smart IPO, it was not only co-sponsored by Morgan Stanley, CICC and GF Securities, but also attracted the favor of 15 top investment institutions including global pharmaceutical giant Lilly, tech giant Tencent, and Oak Capital, Schroder, Temasek, and UBS Assets. The cornerstone lineup is strong.

It is worth mentioning that according to the current Hong Kong Stock Connect “clearance rules”, the issuance market value of HK$13.406 billion by Insili Smart is already higher than the current entry threshold. As long as the company's market value and liquidity are stabilized for 2 trading days before the end of the adjustment inspection period, the company is expected to successfully enter the new Hong Kong Stock Connect adjustment in March next year.

The reason why the long-term value of Insilis Intelligence is highly anticipated by the market is its advantages such as its strong AI platform technology, which has been proven by innovative results, the accumulation of innovation and commercialization in the international market, and unique international cooperation. Currently, with its unique AI underlying platform and technology, Insilicon has become a representative enterprise in the global AI pharmaceutical and scientific intelligence circuit. After successfully landing in Hong Kong stocks, the company's intrinsic value is expected to be further released.

Endorsed by the luxury cornerstone lineup, the Hong Kong market launched a “sweeping mode”

In the second half of the global AI pharmaceutical circuit, more emphasis was placed on platform verification and commercialization. As one of the few companies in the world that achieved coverage of the entire AI drug discovery and development process, Insili Smart's Hong Kong stock IPO was simultaneously endorsed by luxury cornerstone and sought after by market investors, which is enough to show that the current Hong Kong stock market has reached a “value consensus” with this company.

Compared to the many retail investors who gradually deepened their understanding of the company's price investment with the IPO process, many of the top capitals that stood with Insili Smart earlier are clearly more familiar with the long-term value of the company.

During this IPO launch, Insili Intelligence gathered as many as 15 cornerstone investors, including global pharmaceutical giant Eli Lilly, leading internet company Tencent, Singapore sovereign fund Temasek, as well as Schroder, UBS Asset Management, and Oak Capital. The list covered various types of multinational pharmaceutical companies, leading Internet companies, international sovereign funds, and large asset management companies. The cornerstone lineup was luxurious.

It is worth mentioning that this is the first time that global pharmaceutical giant Eli Lilly has participated in the cornerstone investment of a biomedical company.

According to the Zhitong Finance App, on November 10 of this year, Insilis and Eli Lilly reached a research and development cooperation. The two sides will develop, design and optimize candidate compounds in the field of innovative targets, with a potential total of over 100 million US dollars. Now Eli Lilly has joined as a cornerstone investor. Through a deep “capital+business” bond, the strategic partnership between the two sides is expected to further evolve towards a “global core R&D partner”, which is conducive to the long-term stability of cooperation between the two sides.

If Eli Lilly represents the biomedical field, then Tencent represents the leading strategic capital on the Internet circuit. Both appeared on Insili Intelligence's cornerstone list at the same time, showing that the top giants in the two major industries are highly appreciative of the cross-technical strength and business model of “AI+ Pharmaceuticals”.

In addition to the two top industry capitals mentioned above, investors with international attributes and long-term investment preferences on the Insili Smart Cornerstone List are also worthy of attention, such as Temasek, Schroder, UBS Asset Management, and Oak Capital. These institutions are inherently world-renowned “patient capital”, and prefer long-term holding and value growth. These top institutions are now teaming up with Insili Intelligence, which not only indicates mainstream market recognition of the company's reasonable valuation, but also shows confidence in its long-term value growth.

According to the Zhitong Finance App, Insili Smart used “Mechanism B” for distribution. The distribution pattern was mainly based on institutions, cornerstones, and anchor investors. The number of public sales released was about 19,000 lots, and the entry fee was HK$12,146,27. Although the new entry fee threshold is high, the market is still setting off a subscription boom and driving margin leverage to continue to rise. Over 1,000 times oversubscription and margin subscription of nearly HK$300 billion are enough to show that Insili Smart is extremely popular in the Hong Kong market.

Under extremely high “borrowing leverage” and “market popularity,” Insili Intelligence achieved excellent results of Livermore Securities closing a sharp 50.10% increase in the dark market and a sharp rise of 48.44% in the first listing. This fully shows that the intrinsic value of the company's continued growth has been highly recognized by market investors.

Building differentiated value barriers based on advanced AI

The reason why institutional investors and retail investors have been able to forge long-term investment consensus on Intosilicon intelligence is that the company has become a “technology enabler” that uses AI technology to definitively hedge against R&D uncertainty in multiple scenarios, and its commercialization logic has also been continuously verified on the highly competitive AI pharmaceutical circuit.

According to the Zhitong Finance App, new drug development has always been known for “high cost, long cycle, and high risk.” According to statistics, in traditional R&D scenarios, an original innovative drug takes an average of 10-15 years from discovery to marketing, costing more than 2 billion US dollars. How to overcome this predicament? Insili Smart chose to restructure the entire drug development process through AI technology.

Relying on Pharma.ai, a self-developed generative artificial intelligence platform, the company has built a business system integrating drug discovery, pipeline development, software solutions and research in non-pharmaceutical fields. The Pharma.ai platform covers the complete process from target discovery, molecular design to pre-clinical drug candidate confirmation through four major modules: Biology42, Chemistry42, Medicine42, and Science42. Using AI algorithms and automated experiments, the company can reduce the early development cycle of traditional new drugs from about 4-5 years to 12-18 months, significantly improving R&D efficiency and reducing trial and error costs.

Currently, Insili Intelligence is promoting self-developed and innovative drug pipelines based on its strong AI platform capabilities, and has now efficiently built more than 30 R&D projects covering various innovative fields such as oncology, immunity, fibrosis, and metabolism.

Among them, Rentosertib (ISM001-055), the company's core variety for treating idiopathic pulmonary fibrosis (IPF), is one of the fastest-progressing AI-driven drugs in the world. It only took 18 months from target discovery to entering the clinical stage, and traditional pharmaceutical companies took an average of 4.5 years. The drug has previously been certified as a “breakthrough treatment” by the State Drug Administration, and is expected to become the world's first AI drug to enter phase III clinical trials in 2026.

It is worth mentioning that the reason why there is a significant difference between Insilix Intelligence and traditional innovative pharmaceutical companies is not only reflected in higher R&D time efficiency, but also in higher financial efficiency. Financial reports show that from 2022 to 2024, the company's corresponding gross margin reached 63.4%, 75.4% and 90.4%, respectively, showing a clear trend of increasing year by year, and the number of trade receivables turnover days for the company was as low as 6 days during the reporting period.

The extremely high gross profit and cash recovery performance is in stark contrast to traditional Biotech companies that usually face lengthy cash consumption of several years and billions of dollars, and also highlights the advantages of Intosilicon Intelligence in terms of business models.

Driven by the “internal pipeline development+AI platform licensing” two-wheel drive strategy, Insili Intelligence has established an extensive international cooperation network. Of the 20 highest-grossing pharmaceutical companies in the world, 13 have established software platform partnerships with Insili Intelligence. At present, the company has reached 3 pipeline licensing agreements with Exelixis, Menarini, etc., bringing in potential revenue of 2.1 billion US dollars. At the same time, many world-renowned pharmaceutical companies, including Sanofi, Eli Lilly, and Fosun Pharmaceuticals, have also reached drug research and development cooperation with Insili Intelligence.

This shows that while building a highly differentiated AI innovation pipeline through independent development, the company is also actively authorizing AI platform assets to the outside world, promoting the company's AI enabling technology globally through cooperation, and receiving funding for continued development to form a healthy “innovation-commercialization” cycle.

From a market perspective, the global AI-enabled drug development market is expected to grow from US$11.9 billion in 2023 to US$74.6 billion in 2032, with a compound annual growth rate of 22.6%. In this rapidly growing racetrack, Insilicon Intelligence has clearly established a significant first-mover advantage with its proven clinical success stories and technology platforms.

However, in reality, AI pharmaceuticals are only one application enabled by Insili's intelligent AI technology. Currently, the company is also working to expand the scope of application of Pharma.ai to various industries, such as advanced materials, agriculture, nutritional products, and veterinary pharmaceuticals. It is expected to unlock more new blue oceans of industrial cooperation and promote the evolution of the company's commercialization from “AI pharmaceuticals” to a wider “AI for Science”.

epilogue

As a major application scenario enabled by AI technology, AI pharmaceuticals are still on the rise in recent years. Meanwhile, the attitude of multinational MNCs is also shifting from embracing AI technology to competing for innovative voice through open source AI drug discovery models. According to the Zhitong Finance App, in 2023, the number of AI-related cooperative transactions between multinational pharmaceutical companies was only 11, while in the first three quarters of 2024, the number of transactions reached 21, with a total amount of more than 12 billion US dollars. In 2024, Recursion acquired Exscientia for US$688 million, making it the largest merger and acquisition in the AI pharmaceutical field, marking the acceleration of industry integration and the emergence of industry leaders.

As AI pharmaceuticals receive more and more attention and recognition in the industry and market, the average PS valuation of relevant concept stocks in the market has also been pushed to more than 50 times. For example, the PS valuation of US stock Recursion is about 50.56 times, while the PS valuation of Hong Kong stock Jingtai Holdings is 54.13 times.

In contrast, as a leading enterprise in the field of AI technology empowered and AI pharmaceuticals, and a scarce AI for Science company in Hong Kong, Insilicon Smart's current PS valuation is only 32.18 times, and there is a lot of room for valuation improvement compared to peers. With subsequent double acceleration in the capital market and clinical implementation, Insili Intelligence is expected to usher in a continuous release of intrinsic value and continue to open up the valuation ceiling.