Article/Tan Minglei, columnist of Sina Hong Kong (WeChat official account xlgg sina)
Perhaps the "Belt B" series of Hong Kong stocks are now encountering the "crisis resolution" of a bear market. On the Hong Kong stock market, there have been three stocks with B, namely Cinda Bio - B (01801), Geli Pharmaceutical - B (01672) and Baekje Shenzhou - B (06160).
"When a powerful company encounters a huge but solvable crisis, an excellent investment opportunity will come quietly." This is Buffett's original words.
Perhaps the "Belt B" series of Hong Kong stocks are now encountering the "crisis resolution" of a bear market. On the Hong Kong stock market, there have been three stocks with B, namely Cinda Bio - B (01801), Geli Pharmaceutical - B (01672) and Baekje Shenzhou - B (06160).
This is a special arrangement of Hong Kong Stock Exchange to remind investors of "different rights for the same share" and“ Unprofitable biotechnology listed companies ”Risk. In the naming code of stock abbreviations of Hong Kong Stock Exchange, listed companies are required to add special marks' - W 'and ‘-B’ 。
It is worth noting that Baekje is also the first biotechnology company in mainland China to be dual listed in the United States and Hong Kong. According to the naming rules of Hong Kong Stock Exchange, the second listing needs to add a special mark 'S' after the stock abbreviation.
If Baekje Shenzhou-B (06160) is marked as the second listing (S), it will lose the qualification of Shenzhen Hong Kong Stock Connect, and the mainland investors cannot buy this stock, which is negative in terms of funds. And the name [SB] seems a bit inappropriate.
According to the exchange, Baekje China is listed in Hong Kong as a dual primary listing rather than a secondary listing. The dual listing means that the company needs to comply with the market rules on both sides at the same time, which also paves the way for it to enter the Shanghai Shenzhen Hong Kong Stock Connect in the future.
Geli Pharmaceutical - B (01672), the first stock with "B" was listed on August 1. Zhongtai International believes that Geli Pharmaceutical is the first unprofitable new stock of biotechnology enterprises in Hong Kong. It is a pioneer of domestic drugs to seize the Chinese market, and has huge potential for future profits. Geli Pharmaceutical is the leader of domestic hepatitis C drugs, with the first commercial hepatitis C therapy developed by domestic enterprises in China. At present, there are 25 million hepatitis C patients in China, but there is no effective vaccine, and the cure rate is extremely low. Therefore, the two innovative hepatitis C drugs developed by Geli Pharmaceutical are timely help to domestic patients.
At the initial stage of listing, Geli Pharmaceutical's public offering was 9.13 times overbooked. Because there was no performance, investors generally seemed very cautious. As a result, Hong Kong stocks entered a bear market. Geli Pharmaceutical's final price was 14 Hong Kong dollars, and after listing, it fell all the way down until the stock price reached 5.58 yuan, which was worse than the waist cut.
However, in September 2018, Geli Pharmaceutical released its third quarterly report and suddenly announced that it was profitable, so Hong Kong investors began to re-examine this enterprise with "B".
Caitong Securities According to the research report of, the company's performance has three major areas beyond expectations: 1. The integrated platform of antiviral drugs has a promising prospect; 2. The domestic hepatitis C drug market is in the early stage of rapid expansion, and danorevir has begun to contribute to the performance; 3. New drugs under development, such as anti AIDS and fatty liver, support long-term development.
When the enterprise announced that Gnovel (Danorvir) had entered the Tianjin basic medical insurance - hepatitis C outpatient medical expenses paid per capita pilot, the stock price of Geli Pharmaceutical rebounded more than 40%. However, Zhitong Financial APP once believed that its competitor "Jisandai" was announced to be included in the 2018 National Basic Drug Catalog. From the policy point of view, once the third generation of Jilin has advanced into the national medical insurance catalogue, there will be no matter what happened to the product of Geli Pharmaceuticals, namely Gonoway.
But one thing can prove that the rise of the share price is obviously affected by the positive performance. In this sense, The "B" vote of Hong Kong stock actually has the meaning of "scientific progress of venture capital (venture capital)". It is difficult to say that the earnings of non professional players will be stable if they follow up blindly without complete information. Of course, risks are definitely proportional to profits.
Then Baekje Shenzhou-B was listed in Hong Kong. This enterprise focuses on the research and development of anti-tumor drugs, especially targeted therapy and immunotumor drugs for cancer treatment. It was founded in Beijing in 2010 and listed on the NASDAQ in February 2016. At that time, the listing price was 24 US dollars, the stock price had risen about six times in more than two years, and the market value reached 70 billion Hong Kong dollars, indicating that American stock investors still attach great importance to its future potential.
As a global pioneer of innovative cancer therapy, the company's research product line includes a variety of potential best in class anticancer drugs in clinical stage. The stock price of such companies is actually closely related to the time point of the product line. According to Zhitong Finance APP, Baekje China is expected to submit its first new drug marketing application for the treatment of recurrent/refractory mantle cell lymphoma in China in 2018. At present, the production plant in Suzhou of Baekje China has been ready, and will be put into production immediately once the marketing license is obtained.
Overseas, zanubrutinib has been granted the fast track certification by FDA for the treatment of Fahrenheit macroglobulinemia in July 2018. The company is expected to submit the application for the listing of new drugs for Fahrenheit macroglobulinemia to FDA in the first half of 2019.
Before its listing in Hong Kong, Baekje China was over purchased 1.73 times in public offering, with a 100% one hand signing rate, and the final price was HK $108. The listing price did frighten many Hong Kong investors.
At the stage when Baekje China was listed, it was facing a bear market in Hong Kong stocks, especially in the pharmaceutical sector. After listing, the lowest share price was 61.05 Hong Kong dollars. Hong Kong market still has a low recognition of this kind of loss making enterprises. If there is no foreign capital to protect the market, ordinary enterprises must see the performance before investors dare to gamble.
Wang Xiaodong, the founder of Baekje China, stressed after the bell ringing ceremony of listing in Hong Kong that although the time to turn around losses is uncertain, the company is constantly developing new anti-cancer drugs in a scientific way, and believes that more new drugs will be launched in the future, and one day it will turn losses into profits. This statement is a bit far fetched for Hong Kong stock investors who say "no rabbits, no hawks". However, Zhitong Finance believes that, considering the possibility of product innovation, the progress of product research and development, the premium generated by the scarcity of the company and other factors, judging from the valuation range of 4-8 times PS of American Stock Biotechnology Company and the current valuation of about 4 times PS of Merck Group, it should be reasonable to give 5-6 times PS to Baiji Shenzhou, but these drugs are certain risks of failure, Therefore, "gambling" is also a big part.
It is also a loss making pharmaceutical enterprise, and Xinda Bio-b is much luckier to be listed. As a representative enterprise of local innovative monoclonal antibody drugs, 10 basic investors were introduced, involving $245 million, accounting for 61.26% of the share sale at the middle price, with a six-month lock up period. Cornerstone investors include Sequoia Capital, Huili Group, Yongjin Capital, Singapore's Temasek, American Capital and other world-famous institutions.
The co sponsors of Cinda Biology are famous: Morgan Stanley, Goldman Sachs, JPMorgan Chase China Merchants Securities 。 In addition, the offering price itself is reasonable, with a market value of HK $15.6 billion at 13.98 yuan.
As the first two B shares had a very poor trend, the first hand signing rate of Cinda Bio listed reached 100%, and the purchase was won.
However, the market often gives Hong Kong stock investors another miscalculation. After the lowest level of credit biology hit HK $13.60 on the day of listing, the stock price rose all the way, obviously with funds in the market. According to relevant research reports, Cinda Biology has reached cooperation with international well-known systems for many times, and has received down payment and potential milestone payment of up to 3.3 billion dollars.
After the market, Zhitong Financial APP disclosed that the US funded fund The Capital Group increased its holdings of 11.21 million shares of Cinda Biology (01801) on October 31, with a price of HK $13.98 per share, with a total value of about HK $157 million, and the latest shareholding increased to 7.00%.
One week after Cinda Biology was listed, the State Food and Drug Administration accepted the company's application for the listing of new biologically similar drugs of adalimumab for the treatment of ankylosing spondylitis (AS), rheumatoid arthritis and psoriasis.
In fact, Dr. Yu Dechao, the boss of Xinda Biology, is also famous in the pharmaceutical industry. Smart investors may also find clues from the story of Chengdu Kanghong (002773. SZ), an A-share listed company.
After the listing of Cinda Bio-B, its share price has risen all the way, which has indeed brought investors a lot in weak Hong Kong stocks Chinese medicine The confidence of technology-based enterprises.
On the whole, Hong Kong stock "Belt B" enterprises have formed a new plate, and the stock price linkage effect is basically prominent. The author believes that if any enterprise takes the lead in achieving high profit growth reflected in the financial report, the future IPO multi point "Band B" will not affect the confidence of investors.
(The author of this article introduces: Executive Editor in Chief of Zhitong Finance. )
