Daily Brief Health Care: China Traditional Chinese Medicine, UMP Healthcare, Tasly Pharmaceutical Group, BenQ BM Holding Cayman Corp., Dr. Wu Skincare, Daiichi Sankyo, Masimo Corp, GENOVA , Exelixis Inc and more

• China Traditional Chinese Medicine (570 HK)’s monthly update notes that the consortium has secured SAMR approval and made progress in obtaining the other regulatory approvals. 
• As expected, the precondition will not be satisfied before the 18 October long stop date. Unexpectedly, whether the consortium members will consent to the extension remains uncertain.
• The extension will be forthcoming as the delay is procedural, there is a reputational risk from a deal break, the time investment is significant, and the warning was legally required.

For our next Corporate Webinar, we are glad to welcome UMP Healthcare’s Chief Financial Officer and Company Secretary, Patrick Cheung. 

In the upcoming webinar, Patrick will share a short company presentation after which, he will engage in a fireside chat with Smartkarma Insight Provider, Sameer Taneja. The Corporate Webinar will include a live Q&A session.

The webinar will be hosted on Wednesday, 23 October 2024, 15:00 SGT/HKT.

About UMP Healthcare

• China Traditional Chinese Medicine (570 HK) (TCM) will fall today. Perhaps a lot.
• With two days left on the clock to secure the pre-conditions (18th October), the Offeror said “it remains uncertain” whether it can secure an extension from the investor group.
• Such wording could be viewed as boilerplate SFC legalise. I would argue the use of “uncertain” is superfluous, unhelpful, and for investors, downright worrying. 

• Since Tasly’s performance growth has long stagnated and Yan Kaijing has no better way to turn the situation around, selling Tasly to SOE and cashing out becomes a good choice.
• Upon completion of all approvals (e.g. the SASAC, SAMR, shareholders’ meeting of CR Sanjiu, etc.), the deal aims to be completed in 25Q1. We think the deal will get up.
• Tasly’s share price should be at least higher than RMB14.85/share based on the cash transfer price. Its P/E would reach 30 in the future after the integration with CR Sanjiu.

• BenQ BM Holding Cayman Corp. (BBHC HK) is looking to raise at least $US100m in its upcoming Hong Kong IPO. 
• It is a leading private for-profit general hospital group in mainland China, operating two general hospitals – Nanjing BenQ Hospital and Suzhou BenQ Hospital.
• In this note, we look at the firm’s past performance.

• Dr. Wu Skincare is a leading skincare brand from developed Asia known for its skin vitamins and strong financial performance
• Despite not being cheap from a tangible NAV perspective, the brand is considered undervalued with high margins, ROE, and cash returns to shareholders
• Dr. Wu, structured as a pure marketing company with no manufacturing, has top market share in key sales channels in Taiwan and continues to grow and maintain a 5% dividend yield

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• At a 51 NPE, Daiichi Sankyo was priced for perfection.
• We do like their focus on the high growth oncology segment, however, we felt that the valuation left no room for error.
• Post the two disappointing trial announcements, at a 39 NPE, the valuation is become more palatable and getting closer to our mid-thirties target entry point.

• Masimo Corporation’s second quarter of 2024 earnings conference call came with updates that carry implications of both strength and ongoing challenges.
• The company, primarily known for its healthcare technologies, showed a robust performance in its healthcare segment, with a noticeable 23% year-on-year growth in healthcare revenues, totaling $344 million for the quarter.
• This growth is supported by a 29% increase in consumables and service revenue, reflecting strong demand for Masimo sensors, driven by hospital conversions and normalization of installations.

• GENOVA (9341 JP) recorded better-than-expected sales and operating profit in Q1FY25, driven by continued strong demand. With the progress achieved in Q1FY25, the company is expected to beat H1FY25 guidance.
• Medical Platform business has been experiencing steady growth in both the number of articles and page views, leading to creation of multiple contracts and improve the platform’s unit contract price.  
• The company had 14K customers for the Medical Platform Business and the Smart Clinic Business in Q1FY25, a mere 8% of its estimated potential customer base of 173K clinics.

• Exelixis, Inc. presented its second-quarter 2024 financial results, revealing a period of strong performance and strategic advancements in its portfolio.
• The company highlighted significant growth in both its top and bottom lines, primarily driven by the success of the cabozantinib franchise, demonstrating a robust market presence, especially in renal cell carcinoma (RCC).
• Globally, net product revenues from the cabozantinib franchise, along with revenues from partnerships, showed significant increases, totaling $618 million for the quarter.