2025 will be a challenging year for China's healthcare industry, with a series of unforeseen obstacles ranging from the US Biosecure Act to the recurrence of anti-corruption policies in China hampering 2024 healthcare-related industry performance, Morgan Stanley issued a research report saying. However, the broker believed that some of these headwinds will largely subside and stabilize in the coming year.

For biopharma, Morgan Stanley preferred HANSOH PHARMA (03692.HK)  -0.450 (-1.273%)    Short selling $72.91M; Ratio 19.984%   for its strong revenue growth in innovative drugs, strong pipeline and overseas opportunities. In CRO/CDMO, the broker was optimistic about WUXI XDC (02268.HK)  -2.200 (-3.813%)    Short selling $15.38M; Ratio 2.946%   for its good earnings growth prospect this year, which is attributed to its solid project pipeline and lower biosecure and tariff risks.

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In the internet health sector, the broker liked ALI HEALTH (00241.HK)  -0.060 (-1.230%)    Short selling $106.77M; Ratio 23.583%   , mainly due to its higher take rate after the injection of marketing service assets, continued SKU expansion and improved ARPU.

Furthermore, Morgan Stanley was also bullish on INNOVENT BIO (01801.HK)  -5.000 (-5.102%)    Short selling $101.77M; Ratio 4.466%   and AKESO (09926.HK)  +1.700 (+1.100%)    Short selling $171.64M; Ratio 10.028%   in biotech sector as they will commercialize key new products this year, while ZYLOXTB-B (02190.HK)  -0.950 (-4.008%)    Short selling $1.99M; Ratio 12.404%   in the medtech industry was preferred on the basis of its solid commercial execution and broad product mix. The latest ratings and target prices of the sector are listed in a separate table.
(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2025-08-01 16:25.)