| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 37.08 | -27 |
| Intrinsic value (DCF) | 17.01 | -66 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 6.59 | -87 |
Haisco Pharmaceutical Group Co., Ltd. is a prominent Chinese pharmaceutical company specializing in the development, production, and sale of a diverse portfolio of drugs. Founded in 2000 and headquartered in Shannan, China, Haisco has established itself as a key player in the domestic biotechnology and healthcare sector. The company's extensive product line includes small-volume injections, freeze-dried powder injections, large-volume injections, active pharmaceutical ingredients (APIs), tablets, capsules, and ointments. These products cater to critical therapeutic areas such as anti-infective, cardiovascular, digestive system, central nervous system (CNS), diabetes, hepatic diseases, and oncology. Operating on the Shenzhen Stock Exchange, Haisco leverages its integrated business model—spanning R&D, manufacturing, and distribution—to serve the vast Chinese healthcare market. The company's strategic focus on both injectable and oral dosage forms positions it to address a wide spectrum of medical needs, making it a relevant and resilient entity within China's rapidly growing pharmaceutical industry, which is driven by an aging population and increasing healthcare expenditure.
Haisco Pharmaceutical presents a mixed investment profile. On the positive side, the company generated a net income of approximately CNY 395 million on revenue of CNY 3.72 billion for the period, demonstrating profitability. Its dividend per share of CNY 0.28 indicates a shareholder-friendly capital allocation policy. The company maintains a solid cash position of over CNY 1.05 billion, though this is nearly matched by total debt of CNY 1.17 billion. A significant concern is the negative beta of -0.133, suggesting a historical price movement that is inversely correlated with the broader market, which could be interpreted as defensive but also atypical and potentially volatile. The capital expenditures of CNY -440 million indicate substantial investment in maintaining or expanding production capacity, which is necessary in the capital-intensive pharma industry but weighs on free cash flow. The primary investment thesis hinges on Haisco's ability to navigate the competitive and highly regulated Chinese pharmaceutical market and to continue growing its specialized drug portfolio.
Haisco Pharmaceutical operates in the highly competitive Chinese pharmaceutical market, where its competitive positioning is defined by its broad portfolio of injectable and oral formulations across multiple therapeutic areas. The company's advantage appears to lie in its diversification; by not being overly reliant on a single drug class, it mitigates risk from pricing pressures or policy changes targeting specific therapeutic areas. Its involvement in producing Active Pharmaceutical Ingredients (APIs) provides a degree of vertical integration, potentially offering better cost control and supply chain security compared to peers who are purely formulation-focused. However, the Chinese pharma landscape is dominated by giants with significantly larger R&D budgets and more established commercial footprints. Haisco's focus on generics and branded generics, while serving a essential need, places it in a segment susceptible to intense competition and government-led volume-based procurement (VBP) policies that aggressively drive down drug prices. To sustain its position, Haisco must continue to invest in R&D to develop more complex, difficult-to-manufacture generics or novel drugs that can command better pricing. Its regional base in Shannan may also present logistical challenges compared to competitors headquartered in major industrial and commercial hubs, potentially affecting distribution efficiency and talent acquisition.