Shares of Guangzhou Innogen Pharmaceutical Group soared on their Hong Kong debut, buoyed by strong investor appetite for China’s pharmaceuticals sector, which has enjoyed rising valuations and solid performance.
Trading under the stock code 2591, Innogen’s shares first changed hands at HK$72 on Friday, almost four times more than the initial public offering (IPO) price of HK$18.68 despite a declining market. The stock closed at HK$57.25, while the city’s benchmark Hang Seng Index fell 1 per cent.
“We are taking a new step today at Innogen,” the company’s founder and chairman Wang Qinghua said before striking the ceremonial gong with Chief Financial Officer Jiang Fan to mark the company’s trading debut. “We will continue our drive for scientific innovations, guided by [the interests of] our patients.”
The debut performance of the maker of drugs for diabetes and other metabolic diseases followed Chinese vaccine maker Ab&B Bio-Tech’s 158 per cent gain on its first day of trading on Monday.
“There is a lot of unmet clinical demand for our metabolic drugs, which translates to tremendous commercial opportunities,” Wang said.
The success of Innogen’s share sale was bolstered by a rally in major biotech companies in Hong Kong, which gained an average of 137 per cent in cumulative returns this year, according to a CCB International report on Wednesday. Investors were willing to pay more for each unit of sales in the sector as the price-to-sales ratio rose to 18.8 times from 8.7 times in December 2024.
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