HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>With policy optimization and market adjustment, the VBP will pay more attention to the balance between quality, supply, and price. So, we think malignant price competition would be avoided.</li>
<li>By 2025, the VBP of biosimilar drugs will gradually cover the major categories such as monoclonal antibody, growth hormone and blood products, with an average price reduction of 30%-50%</li>
<li>Giant Biogene announced a HK$2.294 billion placement with Placing Price of HK$66.65/Share. Investment logic/fundamentals will change after Class III medical device is approved.Based on 2025-2027 forecast, growth will remain strong.</li>
</ul>


With policy optimization and market adjustment, the VBP will pay more attention to the balance between quality, supply, and price. So, we think malignant price competition would be avoided.
By 2025, the VBP of biosimilar drugs will gradually cover the major categories such as monoclonal antibody, growth hormone and blood products, with an average price reduction of 30%-50%
Giant Biogene announced a HK$2.294 billion placement with Placing Price of HK$66.65/Share. Investment logic/fundamentals will change after Class III medical device is approved.Based on 2025-2027 forecast, growth will remain strong.


China Healthcare Weekly (Apr.20)- Giant Biogene Announced a HK$2.3bn Placement, China's VBP Outlook

Equity Bottom-Up

<ul>
<li>Due to higher technological barriers and stricter review/approval processes, Class III medical device registration certificates in China are scarce.This is the key to addressing the decline in Giant Biogene’s performance/profitability.</li>
<li>The approval for Giant Biogene’s Class III medical device has been delayed. If Trautec and Jinbo take the lead, it will affect the market expectations of Giant Biogene's new products.</li>
<li>Without successful approval of Class III medical devices, reasonable valuation for Giant Biogene is P/E of 20-30x at most. The short-term catalyst is the upcoming online Double Eleven Shopping Festival.</li>
</ul>


Due to higher technological barriers and stricter review/approval processes, Class III medical device registration certificates in China are scarce.This is the key to addressing the decline in Giant Biogene’s performance/profitability.
The approval for Giant Biogene’s Class III medical device has been delayed. If Trautec and Jinbo take the lead, it will affect the market expectations of Giant Biogene's new products.
Without successful approval of Class III medical devices, reasonable valuation for Giant Biogene is P/E of 20-30x at most. The short-term catalyst is the upcoming online Double Eleven Shopping Festival.


Giant Biogene (2367.HK) - The Key to Valuation Expansion and Short-Term Catalyst

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/giant-biogene-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:35950:1" rel="noopener">Giant Biogene (2367 HK)</a> aims to raise up to US$250m via a top-up placement.</li>
<li>We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash and the previous deal didn’t go well.</li>
<li>In this note, we will run the deal through our ECM framework and talk about the recent updates.</li>
</ul>



Giant Biogene (2367 HK) aims to raise up to US$250m via a top-up placement.
We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash and the previous deal didn’t go well.
In this note, we will run the deal through our ECM framework and talk about the recent updates.


Giant Biogene Placement - Great Track Record but Previous Deal Didn’t Do Well

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>Giant Biogene announced strong 2024 results, with revenue up by 57% YoY to RMB5.5bn.</li><li>Revenue from skincare products and medical dressing increased by 62.5% YoY and 41.5% YoY, respectively.</li><li>The increase in revenue proportion of skincare products led to a decline in GPM from 83.6% in 2023 to 82.1% in 2024. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Giant Biogene announced strong 2024 results, with revenue up by 57% YoY to RMB5.5bn.Revenue from skincare products and medical dressing increased by 62.5% YoY and 41.5% YoY, respectively.The increase in revenue proportion of skincare products led to a decline in GPM from 83.6% in 2023 to 82.1% in 2024. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Giant Biogene (2367 HK) - Strong Performance in 2024

<ul>
<li>Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.</li>
<li>GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.</li>
<li>In this note, we will talk about the company’s past performance and future prospects.</li>
</ul>


Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
In this note, we will talk about the company’s past performance and future prospects.


2024 High Conviction - Giant Biogene - Growth Rate Keeps Moving Higher

China

Giant Biogene Holding Co., Ltd researches, develops, manufactures, and distributes, and markets skin treatment products. The Company produces recombinant collagen and rare ginsenosides skin treatment products, functional foods, and other products. Giant Biogene Holding conducts businesses in China.

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Giant Biogene (2367 HK)

China Healthcare Weekly (Apr.20)- Giant Biogene Announced a HK$2.3bn Placement, China's VBP Outlook

VBP policy changes will avoid malignant price competition.Giant Biogene announced HK$2.3bn placement with Placing Price of HK$66.65.Growth will...

Xinyao (Criss) Wang