Yamato: The 1093.HK rating to a "hold" price target of HK$9.9

On February 10, Dahe Issued a research report said that CSPC Pharmaceutical Group (1093.HK) has rebounded by more than 10% year-to-date, significantly better than the performance of its peers, believing that the rise in stock prices is mainly due to its relatively low valuation, in the context of tighter liquidity and uncertainty in the growth of China's healthcare industry, investors will be more inclined to invest in defensive shares. Although there has been no strong improvement in CSPC fundamentals, the bank believes that the downside risks are limited and therefore upgraded CSPC Group's rating from "outperforming the market" to "holding" to maintain its target price of HK$9.9.

CSPC recently announced a 154 million yuan acquisition of a 51% interest in Guangzhou Mingkang Biotech, Daiwa believes that the relatively attractive valuation makes CSPC a defensive stake in China's healthcare industry, although its product pipeline is weak, but considering that the generic drug of its product "Enbipu" has not been approved by the State Food and Drug Administration, it is expected that the sales of the product will bring sustained growth, coupled with CSPC's recent acquisition of a series of innovative drug licenses, becoming the starting point for the transformation into an innovative pharmaceutical company. The bank believes that CSPC still needs to provide more positive news related to product pipelines to support the revaluation.

This article originated from Grand Gateway