HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Guangzhou Innogen Pharmaceutical Group / Equity Capital Markets

<ul>
<li>Innogen’s business, financial condition, operation results and prospects for the next couple of years are substantially dependent on the successful approval and commercialization of Efsubaglutide Alfa, indicating single product risk. </li>
<li>Due to slower R&amp;D progress and fierce competition brought by first movers and generic drugs, commercialization prospects of Efsubaglutide Alfa is highly uncertain, leading to potential lower-than-expected sales performance.</li>
<li>After Series B+ financing, the post-investment valuation of Innogen is already RMB4.65 billion. However, share price of peers has not done well, which makes us cautious about Innogen's IPO prospects.</li>
</ul>


Innogen’s business, financial condition, operation results and prospects for the next couple of years are substantially dependent on the successful approval and commercialization of Efsubaglutide Alfa, indicating single product risk. 
Due to slower R&amp;D progress and fierce competition brought by first movers and generic drugs, commercialization prospects of Efsubaglutide Alfa is highly uncertain, leading to potential lower-than-expected sales performance.
After Series B+ financing, the post-investment valuation of Innogen is already RMB4.65 billion. However, share price of peers has not done well, which makes us cautious about Innogen's IPO prospects.


Pre-IPO Guangzhou Innogen Pharmaceutical Group- The Good Story of GLP-1 May Not Bring High Valuation

Thematic (Sector/Industry)

<ul>
<li>While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".</li>
<li>We analyzed the negatives/"flaws" of popular companies that favored by capital: <a href="https://www.smartkarma.com/entities/brightgene-bio-medical-technol" target="_blank" data-smartkarma-citation="entities:30356:1" rel="noopener">BrightGene Bio-Medical Technol (688166 CH)</a>, <a href="https://www.smartkarma.com/entities/hybio-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:20966:1" rel="noopener">Hybio Pharmaceutical (300199 CH)</a>, <a href="https://www.smartkarma.com/entities/hainan-poly-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:29739:1" rel="noopener">Hainan Poly Pharm (300630 CH), </a>Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.</li>
<li>Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.</li>
</ul>


While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".
We analyzed the negatives/"flaws" of popular companies that favored by capital: BrightGene Bio-Medical Technol (688166 CH), Hybio Pharmaceutical (300199 CH), Hainan Poly Pharm (300630 CH), Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.
Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.


China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>Marriage / Charts of the Day: Marriage loses its luster in China </li><li><p>China-U.S. /: Xi calls for stable ties in meeting with California Governor Newsom</p></li><li><p>Zhongzhi /: Shareholder in Zhongzhi-linked trust firm delists amid deepening liquidity crisis</p></li></ul>

Marriage / Charts of the Day: Marriage loses its luster in China China-U.S. /: Xi calls for stable ties in meeting with California Governor NewsomZhongzhi /: Shareholder in Zhongzhi-linked trust firm delists amid deepening liquidity crisis

CX Daily: Marriage Loses Its Luster in China 

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Qingdao Haier Biomedical  Lt / Index Rebalance

<ul>
<li>The review period for the March rebalance ends today. We forecast 2 changes using a 12-month minimum listing history, and 5 changes using a 6-month minimum listing history.</li>
<li>We expect the index committee to continue using a 6-month minimum listing history. The impact on the potential deletes is a lot higher than the impact on the potential adds.</li>
<li>With 5 changes to the index, estimated one-way turnover is 5.1% resulting in a one-way trade of CNY 4,549m. There is a reasonably large reverse funding trade.</li>
</ul>


The review period for the March rebalance ends today. We forecast 2 changes using a 12-month minimum listing history, and 5 changes using a 6-month minimum listing history.
We expect the index committee to continue using a 6-month minimum listing history. The impact on the potential deletes is a lot higher than the impact on the potential adds.
With 5 changes to the index, estimated one-way turnover is 5.1% resulting in a one-way trade of CNY 4,549m. There is a reasonably large reverse funding trade.


STAR50 Index Rebalance Preview: 5 Changes Forecast as Review Period Ends

<ul>
<li>Nearly 85% of the way through the review period, we see 2 changes using a 12-month minimum listing history, and 5 changes using a 6-month minimum listing history.</li>
<li>Given the significantly higher market cap of the inclusions using a 6-month minimum listing history, we expect the index committee will continue to use the shorter listing history requirement.</li>
<li>With 5 changes a side, one-way turnover is estimated at 5.15% and will result in a one-way trade of CNY 3,994m. Impact on some deletions is quite high.</li>
</ul>


Nearly 85% of the way through the review period, we see 2 changes using a 12-month minimum listing history, and 5 changes using a 6-month minimum listing history.
Given the significantly higher market cap of the inclusions using a 6-month minimum listing history, we expect the index committee will continue to use the shorter listing history requirement.
With 5 changes a side, one-way turnover is estimated at 5.15% and will result in a one-way trade of CNY 3,994m. Impact on some deletions is quite high.


STAR50 Index Rebalance Preview: Another Five Potential Changes in March

China

BrightGene Bio-Medical Technology Co., Ltd. researches, develops, manufactures, and distributes biopharmaceuticals. The Company produces antifungal drugs, cardiovascular drugs, iron supplement agents, and more. BrightGene Bio-Medical Technology sells its products in Israel, USA, Japan, India, South Korea, and other countries and regions.

BrightGene Bio-Medical Technology (688166 CH)

Price Gauge
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BrightGene Bio-Medical Technology (688166 CH)

Pre-IPO Guangzhou Innogen Pharmaceutical Group- The Good Story of GLP-1 May Not Bring High Valuation

Innogen's future success hinges on approval of Efsubaglutide Alfa, but uncertainty in commercialization and competition will impact sales...

Xinyao (Criss) Wang

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

CX Daily: Marriage Loses Its Luster in China

Marriage / Charts of the Day: Marriage loses its luster in China The number of marriage registrations in China plunged last year to the fewest in...

Caixin Global

STAR50 Index Rebalance Preview: 5 Changes Forecast as Review Period Ends

There could be 5 index changes in March if the index committee continues using a 6-month minimum listing history. One-way turnover will be over 5%....

Brian Freitas

STAR50 Index Rebalance Preview: Another Five Potential Changes in March

There could be 5 changes using a 6-month minimum listing history. One-way turnover will be 5%+ resulting in a one-way trade of CNY4bn. Impact on...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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Pre-IPO Guangzhou Innogen Pharmaceutical Group- The Good Story of GLP-1 May Not Bring High Valuation

​Innogen's future success hinges on approval of Efsubaglutide Alfa, but uncertainty in commercialization and competition will impact sales...

Xinyao (Criss) Wang

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

CX Daily: Marriage Loses Its Luster in China

Marriage / Charts of the Day: Marriage loses its luster in China The number of marriage registrations in China plunged last year to the fewest in...

Caixin Global

STAR50 Index Rebalance Preview: 5 Changes Forecast as Review Period Ends

There could be 5 index changes in March if the index committee continues using a 6-month minimum listing history. One-way turnover will be over 5%....

Brian Freitas

STAR50 Index Rebalance Preview: Another Five Potential Changes in March

There could be 5 changes using a 6-month minimum listing history. One-way turnover will be 5%+ resulting in a one-way trade of CNY4bn. Impact on...

Brian Freitas

Innogen's future success hinges on approval of Efsubaglutide Alfa, but uncertainty in commercialization and competition will impact sales...