Among the various awards announced for the 2024 Nobel Prizes, the field of AI undoubtedly emerged as the "biggest winner".

From the Nobel Prize in Physics being awarded to two AI scientists, to the Nobel Prize in Chemistry recognizing three scientists for "deciphering the code of proteins using Artificial Intelligence (AI)", the high level of AI content in this year's Nobel Prizes has sparked heated market discussions.

Notably, in June of this year, XtalPi (QUANTUMPH-P, 02228.HK), which debuted on the Hong Kong Stock Exchange as the "first special technology enterprise listed under Hong Kong's 18C rule," aligns its research direction with the fields favored by the three Nobel Prizes, making it a "top player" endorsed by the Nobel Prizes.

With such precise alignment with the technological trends in AI innovation, what is the growth potential of XtalPi?

"AI + Research" Gradually Becomes the Mainstream

XtalPi's Technology Reserves Align with Three Nobel Prize Directions

As a bellwether for technological development, this year's Nobel Prizes favoring the field of AI reveal that AI technology is permeating various academic disciplines and rewriting the "rules of the game" in scientific research.

In recent years, AI's reach has extended to every corner of science, and the industrialization process of AI+disciplines has continued to accelerate.

Among the fields highlighted by the Nobel Prizes, XtalPi has made forward-looking investments.

According to information, XtalPi is an innovative R&D platform based on quantum physics, empowered by AI, and driven by robots, primarily providing solutions and services for drug and material science R&D.

In the direction of "AI+Physics" focused on by the Nobel Prize in Physics, XtalPi boasts a core technology platform combining quantum physics, AI, and robotics, making it one of the earliest enterprises in China to deploy interdisciplinary algorithms that integrate "Physics+AI"; in the field of microRNAs awarded the Nobel Prize in Physiology or Medicine, XtalPi has also collaborated with companies such as CK Life Sciences to develop miRNA- and AI-based predictive molecular diagnostic models for cancer prognosis risks.

Furthermore, just one day after the Nobel Prize in Chemistry was awarded to the developers of AlphaFold, XtalPi officially announced that its AlphaFold-like technology platform, XtalFold, had signed a commercial licensing agreement with Janssen Biotech, a subsidiary of Johnson & Johnson, earning recognition from a major industry player.

It is not difficult to see that the three major prizes in the field of natural sciences awarded at this year's Nobel Prizes are highly relevant to XtalPi's business layout. The reason XtalPi has repeatedly "predicted" cutting-edge technological trends lies in the high probability of such trends occurring under "large sample sizes."

XtalPi's platform integrating quantum physics, AI, and robotics is applicable to biomedicine and new materials, covering a wide range of R&D fields such as chemical drugs, biological drugs, new energy, petrochemicals, chemicals, agriculture, and consumer goods. The label of a "top student" in the field of scientific and technological innovation is also reflected in the company becoming the first IPO under the Hong Kong Stock Exchange's Chapter 18C specialized technology regime since its implementation over a year ago.

The Hong Kong Stock Exchange introduced the 18C reform, extending an olive branch to high-tech "specialized, refined, distinctive, and innovative" core technology companies. Due to its high requirements for a company's technological attributes and market value thresholds, the 18C rule is considered tailored for unicorn technology enterprises genuinely favored by capital. Later, in August, the market value threshold was lowered. Against this backdrop, the gold content of "18C's First IPO," XtalPi, speaks for itself.

It is worth mentioning that the 18C rule requires 2-5 seasoned independent lead investors to "escort" the company, and XtalPi has reached the maximum limit of five seasoned independent lead investors, including Tencent, Sequoia Capital China, Matrix Partners China, China Life Chengda, and PICC Health Insurance Fund. According to the 18C rule, the lock-up period for seasoned independent lead investors can be up to 12 months (for uncommercialized companies), reflecting the confidence of many top investment institutions in the long-term development of "AI+Robotics"-empowered R&D and XtalPi as a leader in this field.

Technically, XtalPi boasts the aura of being the first company in "AI Pharmaceuticals" and "AI+Robotics," with a technology combination of quantum physics, AI, and robotics that is somewhat scarce. The company's comprehensive technological advantages are evident. For instance, amidst the global AI industry's shortage of data, especially high-quality data, XtalPi has independently developed a robotic laboratory capable of continuously generating real data for AI algorithm iterations.

According to XtalPi, it has established laboratories spanning tens of thousands of square meters and plans to continue deploying its automated robotic workstations on a large scale in North America and other regions. The automated laboratory, as an independent solution, has already secured purchase orders from institutions and enterprises such as Fudan University and Sinopec.

Note: XtalPi's self-developed AI+Robotics laboratory

Apart from technical prowess, XtalPi's business model also disrupts the limitations of traditional models. Positioning itself as an AI platform-based ecological technology enterprise, the company breaks through the competition in AI pharmaceuticals by empowering others. According to its interim report, the company's comprehensive technology platform has utilized over 700 million core hours of cloud computing and contributed to over 500 projects, including drug discovery and solid-state R&D.

While gaining recognition from major pharmaceutical companies like Johnson & Johnson, XtalPi also extends its underlying technological advantages beyond the AI pharmaceutical industry, breaking through industry boundaries. Riding the policy wave of industrial digital transformation and smart manufacturing, the company has signed cooperation agreements in numerous industries such as new materials, petrochemicals, and new energy, unleashing a "smart innovation engine."

With both internal and external expansion, XtalPi stands on the eve of an explosion. The announcement of this year's Nobel Prizes further clarifies AI's role as one of the core driving forces for the intersection of technology and disciplines, reinforcing the certainty of the company's long-term growth.

Building a Global AI Innovation Ecosystem, Unleashing Platform Economic Value

As new scientific research paradigms emerge and bring profound impacts, the industrial prospects for "AI+Smart Manufacturing" are even brighter. When it comes to commercializing AI technology and scientific innovation scenarios, XtalPi boasts three key advantages:

1. An entrepreneurial team with an international perspective, linking global high-quality innovation resources.

All three founders of XtalPi are postdoctoral fellows from the Massachusetts Institute of Technology (MIT), sharing alumni status with one of this year's Nobel Prize winners in Physiology or Medicine. They maintain close collaboration with MIT's research teams, such as working with Professor Bradley L. Pentelute to advance peptide chemistry and molecular biology research. In August of this year, the company's co-founder and Chairman, Shuhao Wen, was invited by MIT to join its External Advisory Committee, becoming the youngest member of the chemistry division.

Drawing on the technical background of its founding team, XtalPi adheres to independent innovation and research to create a globally competitive technology platform, demonstrating that excellent managers are vital assets for enterprises. As Charlie Munger once said, "Truly outstanding individuals are rare. Having the opportunity to follow and collaborate with them may be worth paying a premium for, as it could lead to substantial rewards in the future."

2. Deep integration into the global innovation network, broadening the path for platform-based ecological technology enterprises.

Promoting innovation through openness and improving the global innovation system are trends in the development of China's scientific and technological innovation enterprises. Positioned as an innovation platform, XtalPi serves the global market. According to Frost & Sullivan, the company has served over 300 biotechnology and pharmaceutical companies and research institutions worldwide, including 16 of the top 20 global biotechnology and pharmaceutical companies.

In this process, XtalPi achieves bidirectional empowerment between AI and biomedicine.

On the one hand, XtalPi leverages AI to drive innovation in pharmaceutical R&D, participating in the development of Paxlovid, the world's first small molecule oral COVID-19 drug approved by the FDA under Pfizer's leadership. This shortened the originally multi-month development timeline to just six weeks, significantly accelerating the drug's journey from R&D to market.

On the other hand, XtalPi unleashes the commercial potential of AI technology. In 2023, the company collaborated with Eli Lilly on AI+robotics-based small molecule drug development, with a total prepayment and milestone revenue of US$250 million, setting a new record for China's AI pharmaceutical single-pipeline deal that year.

This underscores the continuous enhancement of XtalPi's global recognition of its "hard power" and signals the continued expansion of the company's global innovation ecosystem, with promising potential for overseas market business.

3. Common technologies generate spillover effects, opening up multiple golden racecourses.

XtalPi has built an innovative R&D platform integrating quantum physics, AI, cloud computing, and robotic laboratories, realizing the integration of common technologies and laying a foundation for the sustainability and scalability of future business development.

For instance, in August of this year, XtalPi signed a five-year cooperation agreement with GCL Group, expecting to receive phased R&D payments totaling approximately US$135 million (approximately RMB 1 billion) to jointly develop a series of differentiated new materials with industry competitiveness and industrial application potential, as well as to build a large model-driven AI+automated digital and intelligent creation system for GCL in the materials field.

As XtalPi achieves results in the fields of drug and material science, its business volume grows rapidly, forming a virtuous cycle between technological investment and commercial outcomes. In the future, as more traditional industries embrace "AI+Smart Manufacturing," the company is poised to expand its business portfolio further, leveraging the multiplier effect of "AI+" across various industries.

In summary, XtalPi boasts a founding team with a global perspective and abundant global cooperation resources, with clear commercialization potential from "1 to N."

Building an Industrial Engine for the "AI+" Era, Gradually Realizing the Company's Growth Potential

After this year's Nobel Prizes, the entire scientific research field will embark on a new paradigm of AI-driven research.

As the potential and value of AI technology continue to unfold, XtalPi's current layout will gradually enter its harvest period. Bain & Company predicts that as AI technology rapidly gains popularity and disrupts businesses and economies, the global market for AI-related products is expanding and expected to reach US$990 billion by 2027. In the field of AI, XtalPi possesses dual scarcity: it is both a scarce technology platform endorsed by international players and triple Nobel Prizes, and a scarce target in the vertical AI sector of the global capital market, exhibiting robust development momentum.

Image source: Bain & Company

The tipping point for scientific research strength has arrived. Upon reviewing XtalPi's business landscape once again, it becomes evident that the company has not only seized the technological dividends arising from the intersection of AI and scientific research but also directly confronted the innovation dividends of the global market by continuously empowering companies within its ecosystem.

Meanwhile, as the global pharmaceutical industry continues to expand, the company will maintain high growth in business demand. Combined with the vast landscape of "AI+Smart Manufacturing," XtalPi boasts a high business volume ceiling. With excellent industry prospects and immense self-development potential, this explains why XtalPi has emerged as a "top student" under the Hong Kong Stock Exchange's 18C rule.

Charlie Munger once said, "The first rule of fishing is to fish where the fish are. The second rule of fishing is to remember the first rule." With high growth in the AI+Smart Manufacturing industry, XtalPi's potential investment value is also favored by institutions in the long run. Following the Nobel Prizes, the certainty of the company's strategic direction and business value is bound to enter the awareness of more investors, potentially attracting those interested in technological innovation.

Looking ahead, the enormous potential for XtalPi's AI+Smart Manufacturing value release will be fully manifested in valuation changes in the market.

Source: Hong Kong Stock Research