Markets· Equity· IPO

Xinxiang Tuoxin Pharmaceutical’s IPO to debut on Shenzhen Stock Exchange

minutes 2021/10/26 10:11:59

Oct 26, 2021 (China Knowledge) - Xinxiang Tuoxin Pharmaceutical (301089) to start trading on the Shenzhen ChiNext Market Oct 27, tomorrow. The firm has issued 31.50 mln shares priced at RMB 19.11 per share raising RMB 601.97 mln. Its price-to-earnings ratio (PE) stands at 22.65. During subscription the IPO was 6,846 times oversubscribed.

ZTF Securities acts as the lead underwriter and sponsor for the IPO.

Xinxiang Tuoxin Pharmaceutical Co Ltd is a China-based company mainly engaged in biopharmaceuticals. The Company's main business is the research, development, production and sales of chemical synthesis, bio-fermentation nucleoside (acid) active pharmaceutical ingredients (APIs) and pharmaceutical intermediates. The Company's products include citicoline sodium, ribavirin, inosine, acyclovir, cytosine, 5-fluorocytosine, cytidine and other APIs and pharmaceutical intermediates. The Company's products are mainly used in the fields of antiviral, antitumor and nervous system medications.

In FY 2020, Xinxiang Tuoxin Pharmaceutical garnered a total revenue of RMB 528 mln, up 37% YoY. In terms of net income, it achieved RMB 113 mln, rising 84% YoY. In H1 2021, the company reported revenue of RMB 284 mln, a YoY increase of 17%, and its net profits reached RMB 53 mln, up 2% YoY.

The company is in the pharmaceutical and biological industry that is currently made of 398 counters in Shanghai and the Shezhen Stock Exchange with a total combined market capitalization of RMB 7,739 bln, industry’s average PE of 38 times. The pharmaceutical and biological industry’s index is up 6.85% year-to-date, ranking it the 18th place among all 29 broad industry groupings.

Shanghai Pharmaceuticals Holding Co.,Ltd (601607) takes up the top spot in terms of sales in the industry, reporting RMB 191.91 bln of sales in 2020, with a net profit of RMB 4.5 bln, at 9 times PE. The second largest is Jointown Pharmaceutical Group Co., Ltd (600998), a total revenue of RMB 110.86 bln and a net profit of RMB 3.08 bln, at 8 times PE. Guangzhou Baiyunshan Pharmaceutical Holdings Company Limited (600332) ranked third. It garnered a total revenue of RMB 61.67 bln last year, and a net profit of RMB 2.92 bln, with 13 times PE.

The average industry’s PE for the same or similar stocks on Hong Kong Exchange (HKEx) and the U.S. stock markets for pharmaceutical and biological is 34 times and 50 times, respectively. On a year-to-date basis, the industry’s index on the HKEx rises 12.82% and the U.S is up 23.71%.

There will be another 4 IPO debut tomorrow, Jiusheng Electric Co., Ltd. (301082), Zhejiang Sunrise Garment Group Co., Ltd (605138), Shareate Tools Ltd. (688257) and Jing-Jin Electric Technologies Co., Ltd. (688280).

Since January, a total of 391 companies have listed on either Shanghai or Shenzhen Stock Exchange, most are mainly in the machinery equipment, electronics and pharmaceutical and biological industries.

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