HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>Despite high growth in 2023, the accelerated growth of Giant Biogene has entered a turning point, and its performance has begun to slow down. Long-term growth momentum is highly uncertain. </li>
<li>Giant Biogene plans to prioritize the market entry of Class III medical device products.Due to increasing competition/challenges in marketing/promotion, it takes time to verify if the second growth curve works. </li>
<li>Reasonable valuation for Giant Biogene is P/E of 20-30x.If based on RMB1.8 billion 2024, market value is RMB36-54 billion. Short-term catalyst is the Online 618 Shopping Festival and 24H1 report.  </li>
</ul>


Despite high growth in 2023, the accelerated growth of Giant Biogene has entered a turning point, and its performance has begun to slow down. Long-term growth momentum is highly uncertain. 
Giant Biogene plans to prioritize the market entry of Class III medical device products.Due to increasing competition/challenges in marketing/promotion, it takes time to verify if the second growth curve works. 
Reasonable valuation for Giant Biogene is P/E of 20-30x.If based on RMB1.8 billion 2024, market value is RMB36-54 billion. Short-term catalyst is the Online 618 Shopping Festival and 24H1 report.  


Giant Biogene (2367.HK) Placement - A Turning Point in Performance Growth Has Emerged

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.

Event-Driven

<ul>
<li>Giant Biogene raised around US$70m in its Hong Kong IPO, after having downsized the deal and priced it at the low-end. Its six-month lockup will expire soon.</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 lock-up dynamics and updates since our last note.</li>
</ul>


Giant Biogene raised around US$70m in its Hong Kong IPO, after having downsized the deal and priced it at the low-end. Its six-month lockup will expire soon.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
In this note, we will talk about the lock-up dynamics and updates since our last note.


Giant Biogene IPO Lock-Up - US$1.7bn Lockup Release Will Increase Free Float by 14x

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.

Equity Bottom-Up

<ul><li>Giant Biogene is a leader in the professional skin treatment industry in China, promoting products based on bioactive ingredients, especially recombinant collagen.</li><li>Comfy (可复美) and Collgene (可丽金) are the Company’s two flagship brands that drove Giant Biogene’s growth.</li><li>The Company’s revenue increased at a CAGR of 35.2% from RMB956.7mn in 2019 to RMB2,364.4mn in 2022 and further surged by 63.0% YoY to RMB1,605.7mn in 1H23.</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 is a leader in the professional skin treatment industry in China, promoting products based on bioactive ingredients, especially recombinant collagen.Comfy (可复美) and Collgene (可丽金) are the Company’s two flagship brands that drove Giant Biogene’s growth.The Company’s revenue increased at a CAGR of 35.2% from RMB956.7mn in 2019 to RMB2,364.4mn in 2022 and further surged by 63.0% YoY to RMB1,605.7mn in 1H23.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) – Pioneer in Recombinant Collagen Market

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.bloomberg.com/news/articles/2023-08-09/l-occitane-boss-is-said-in-advanced-talks-on-6-5-billion-buyout?in_source=embedded-checkout-banner" target="_blank" rel="noopener">According to Bloomberg</a>, <a href="https://www.smartkarma.com/entities/l-occitane-international-sa" target="_blank" data-smartkarma-citation="entities:6772:1" rel="noopener">L'Occitane (973 HK)</a> is set to receive a HK$35 per share privatisation offer from Reinold Geiger, the Chairman and the largest shareholder.</li>
<li>The rumoured price is attractive and represents an all-time high share price. Therefore, Acatis KVG, the shareholder with a blocking stake, would be supportive.</li>
<li>The rumoured price implies multiples at a discount to peer multiples, which explains Mr Geiger’s ambitions for a possible European listing to secure higher valuation multiples. </li>
</ul>



According to Bloomberg, L'Occitane (973 HK) is set to receive a HK$35 per share privatisation offer from Reinold Geiger, the Chairman and the largest shareholder.
The rumoured price is attractive and represents an all-time high share price. Therefore, Acatis KVG, the shareholder with a blocking stake, would be supportive.
The rumoured price implies multiples at a discount to peer multiples, which explains Mr Geiger’s ambitions for a possible European listing to secure higher valuation multiples. 


L’Occitane (973 HK): HK$35 Offer from the Controlling Shareholder?

<ul>
<li>
<a href="https://www.smartkarma.com/entities/l-occitane-international-sa" target="_blank" data-smartkarma-citation="entities:6772:1" rel="noopener">L'Occitane (973 HK)</a> is drawing takeover interest from Reinold Geiger, the Chairman and the largest shareholder, <a href="https://www.bloomberg.com/news/articles/2023-07-25/l-occitane-owner-said-to-mull-buyout-of-4-billion-beauty-firm" target="_blank" rel="noopener">according to Bloomberg</a>. Mr Geiger has been exploring financing options for the potential deal.</li>
<li>The presence of a significant disinterested shareholder, Acatis KVG, necessitates an attractive takeover premium. Acatis KVG trimmed its stake in July 2021 at HK$30.01 per share.</li>
<li>L’Occitane released a solid <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0725/2023072500263.pdf" target="_blank" rel="noopener">1QFY2024 update</a> today with constant currency growth of 24.5% YoY. Irrespective of a bid materialising, the valuation is undemanding compared to peer multiples. </li>
</ul>



L'Occitane (973 HK) is drawing takeover interest from Reinold Geiger, the Chairman and the largest shareholder, according to Bloomberg. Mr Geiger has been exploring financing options for the potential deal.
The presence of a significant disinterested shareholder, Acatis KVG, necessitates an attractive takeover premium. Acatis KVG trimmed its stake in July 2021 at HK$30.01 per share.
L’Occitane released a solid 1QFY2024 update today with constant currency growth of 24.5% YoY. Irrespective of a bid materialising, the valuation is undemanding compared to peer multiples. 


L’Occitane (973 HK): Controlling Shareholder Mulling a Bid?

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)