"Unicorn" WuXi PharmaTech opens a new economic wave today

Today, Wuxi WuXi PharmaTech New Drug Development Co., Ltd. (hereinafter referred to as “Yuanming Kangde”) officially opened the subscription, becoming the first unicorn after the IPCC’s IPO “Immediately Appeal” green channel new policy "enterprise.

According to expert analysis, WuXi PharmaTech’s purchase is only the beginning of the “unicorn” wave. It is believed to be a revolution in the structure of listed companies in China’s stock market. It also shows that the proportion of new economic elements in China’s economic structure is increasing. leading position.

According to the data, the company was founded in 2000 and started out as a pharmaceutical R&D outsourcing service (CRO). It provides a series of laboratory R&D, research and production services to global pharmaceutical companies, biotechnology companies and medical device companies. It is the largest small in China. Molecular medicine research and development service enterprises.

Reducing the proportion of fundraising is conducive to resolving market concerns

According to the prospectus, the number of IPOs issued does not exceed 104 million shares. It is estimated that the amount of funds raised this time will be 2.13 billion yuan, and the issue price per share is 21.6 yuan. It is worth noting that the amount of funds raised is 63% lower than the pre-disclosed 5.74 billion yuan.

"In view of the current situation of China's stock market, although the market has hope for the unicorns, it is also full of doubts about the large number of unicorn companies' centralized listing." Securities investment expert Hou Ning further said that the main concerns are mainly reflected in two aspects: First, Whether it is really a unicorn enterprise, a swindler may be among them. Second, if a large number of unicorns open their blood to absorb blood, they will have market capacity. ”

“So, reducing the proportion of fundraising is conducive to resolving market concerns and opening the way for the subsequent listing of unicorn companies,” he said.

In addition, according to the amount of funds raised and the number of newly issued shares, the price of the drug will be over 55 yuan per share, and the price-earnings ratio will increase by about 50 times.

P/E ratio falls below the red line to help reduce the unicorn A-share listing bubble

However, some insiders pointed out that after the large-scale reduction of WuXi PharmaTech's fundraising, the price-earnings ratio will fall to 22.99 times, which is below the red line of 23 times the price-earnings ratio.

In this regard, Hou Ning believes that it is wise to lower the price-earnings ratio of WuXi PharmaTech.

"If the P/E ratio on the first day of listing is too high, the market will inevitably release the signal of "good profit", which may cause a daily stagnation and drag down the market, and also hurt the confidence of the market to invest in unicorn companies, and give other unicorn companies in the market. Landing A shares creates negative effects."

Hou Ning further analyzed that due to the low valuation, market investment funds may gradually intervene to push up the stock price, which will also have a stabilizing effect on the market. Thus, the role of unicorn enterprises in the market is benign from the beginning, which is beneficial to Subsequent listings of similar companies.

Economist Song Qinghui said that WuXi PharmaTech’s P/E ratio has not been issued at a high price. This shows that the regulatory authorities’ strict control over the unicorn enterprise’s fundraising will also help reduce the unicorn A-share market bubble. .

“Fast meeting” reflects the strong support of the regulatory authorities for the new economy.

As the first Chinese stock to return to A-shares in the form of IPO, WuXi PharmaTech’s “quick speed” will be widely concerned by the market.

Prior to February 6, WuXi PharmaTech's IPO showed a pre-disclosure update; on March 27, WuXi PharmaTech met. From the 73rd place in the queues of the Shanghai Stock Exchange to the successful meeting, WuXi PharmaTech only took about 50 days.

And, after more than half a month, before the Foxconn, "lightning" to get the IPO approval.

Market participants believe that the rapid past meeting of WuXi PharmaTech benefits from the recent policy of A-shares embracing the “unicorn”, which reflects the strong support of the regulatory authorities for the new economy. At the same time, it points out to the relevant companies a feasible path for rapid listing. Has a certain reference.

Data show that WuXi PharmaTech achieved operating income of 6.12 billion yuan in 2016, net profit of 1.12 billion yuan; operating income in 2017 was 7.765 billion yuan, net profit was 979 million yuan, the company nearly 3 The annual gross profit margin is 38.90%. Among them, the company's pharmaceutical innovation and R&D business developed well. From 2014 to 2016, WuXi PharmaTech's CRO business accounted for 1.64%, 1.80%, and 2.02% of the global market share, showing an upward trend year by year.

Goodwill value increases rapidly or generates certain risks in the short term

It is worth noting that the value of the company's goodwill has changed a lot. According to the prospectus, the book balance of goodwill as of September 30, 2017 was 1.059 billion yuan, compared with 380 million yuan on March 31, 2017, an increase of 679 million yuan in just half a year.

This also caused the attention of the audit committee. “The issuer’s goodwill and intangible assets at the end of 2017 are large. After the provision for impairment of customer relationship, goodwill and trademark use rights, the balance of goodwill plus intangible assets (net of land use rights) is lower than the net assets. 20%." Therefore, the IEC requires it to explain the rationality.

In this regard, WuXi PharmaTech said in the prospectus that this part of the goodwill is mainly generated by the acquisition of Huiyuan Biological's detection and analysis business - efficacy evaluation and testing business. Huiyuan Bio's total assets fell to 199 million yuan on September 30, 2017, with a decrease of 24.174 million yuan. Its net profit for the first three quarters of 2017 was 1.332 million yuan.

Insiders said that goodwill represents a potential economic value. In the process of corporate mergers and acquisitions, high premiums tend to generate high goodwill, but at the same time there are certain risks. “For example, if the performance of the acquired target is not as good as expected, then the goodwill may be impaired, which in turn affects the net profit of the entire company.”

WuXi PharmaTech delisted from the NYSE at the end of 2015 and was known as the “Huawei” in the pharmaceutical industry. Today, WuXi PharmaTech opened its subscription and officially became the first “unicorn” company listed in Shanghai and Shenzhen.

"Overall, the listing or return of unicorn companies is a major event in the stock market this year. It is also a major manifestation of the central government's qualitative change in capital market policies after the two sessions this year." Hou Ning said that this shows that China is from the top to the grassroots. It has been recognized that science and technology, invention and innovation play an important role in modern economic life, and it also shows that the proportion of new economic elements in China's economic structure is increasingly dominant. (Central Broadcasting Network)


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