In today’s briefing:
- China Traditional Chinese Med (570 HK): Third Time’s the Charm as Sinopharm Revives Its Interest?
- China Traditional Chinese Medicine (570.HK) – Will This Privatization Rumor Come True ?
- HK CEO & Director Dealings (8 Feb 2024): Tigermed, East Buy, Kingkey Financial
- Chugai Pharmaceutical (4519 JP): Ronapreve Killed Joy in 2023; New Products to Drive Growth Ahead
- Immix Biopharma – Increased legroom following common-only raise
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China Traditional Chinese Med (570 HK): Third Time’s the Charm as Sinopharm Revives Its Interest?
- Bloomberg reports that Sinopharm is reviving its interest in privatising China Traditional Chinese Medicine (570 HK)/CTCM. Sinopharm has contacted banks about financing and is considering partnering with other investors.
- Sinopharm’s best bet is to partner with Ping An Insurance Group of (601318 CH) and privatise through a scheme. In this scenario, no disinterested shareholder would hold a blocking stake.
- Due to Sinopharm’s previous privatisation attempts, shareholders will be wary of the latest rumour. Nevertheless, the valuation is undemanding compared to peer multiples.
China Traditional Chinese Medicine (570.HK) – Will This Privatization Rumor Come True ?
- We once again heard privatization rumor of China TCM, but China TCM denied it at this stage. We still recommend investors to remain vigilant until receive definite official announcement.
- One important background of privatization is the integration of SOE carried out in recent years. We do not rule out the possibility that Taiji Group would drive this privatization.
- It may not be an optimal time for the proposal of privatization by major shareholders. Other shareholders may not want to give up high-quality stocks, which makes privatization challenging.
HK CEO & Director Dealings (8 Feb 2024): Tigermed, East Buy, Kingkey Financial
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
- The key stocks mentioned in this regular insight are Hangzhou Tigermed Consulting C (3347 HK), East Buy Holding (1797 HK) and Kingkey Financial (1468 HK).
Chugai Pharmaceutical (4519 JP): Ronapreve Killed Joy in 2023; New Products to Drive Growth Ahead
- Chugai Pharmaceutical (4519 JP) reported 5% YoY decline in core revenue in 2023, due to the decrease in the supply of COVID-19 treatment Ronapreve to the government.
- For 2024, Chugai expects core revenue to decline mainly due to the absence of Ronapreve revenue and decline in Actemra export. However, operating and net profits are expected to increase.
- Hemlibra export and new launches such as Vabysmo, Phesgo, Polivy, and Alecensa are expected to drive long-term growth of the company.
Immix Biopharma – Increased legroom following common-only raise
Immix Biopharma has announced a $15m (gross), fully underwritten equity issue. The company will use the proceeds to fund clinical trials for lead CAR-T asset NXC-201, as well as to meet working capital and general corporate needs. Immix had a net cash balance of $19.6m at end September 2023 and we estimate that this capital injection will potentially extend the cash runway to end FY25 or early FY26, past the top-line readouts from its Phase Ib/IIa clinical trials for NXC-201 (NEXICART-1), which, if positive, could pave the way for a partnering deal. We view the release of further rolling data from the trial and first patient dosing in the US (NEXICART-2) across H124 as potentially key upcoming catalysts for the company.