Vaccine related shares go up
As the H1N1 flu spread all over the world, the share prices of domestic vaccine makers rose on surging order for vaccines, even the benchmark Shanghai Composite Index fell 2.83 percent.
The vaccine producer Hualan Biological rose 2.47 percent to 57.7 yuan in Shenzhen on Oct 27 while Layn Natural Ingredients rose 2.93 percent to 44.94 yuan.
As Shenzhen Neptunus Bioengineering Co increased 9.24 percent to 15.85 yuan, Zhejiang CONBA Pharmaceutical Co LTD also increased 6.13 percent to 12.12 yuan. China Meheco Corporation closed at 20.98 yuan yesterday, 10 percent up.
The share market also goes well and the five companies’ shares hit the daily limits of 10 percent on Monday.
An industrial analyst Cai Jianjun pointed, the recent gain is mainly underpinned by government orders for vaccines.
China faced a grim situation in containing the disease as the number of cases has risen, said Health Minister Chen Zhu. As of Oct 26, china reported 35,664 H1N1 inflection with 3 deaths, and also in the US President Obama declared that H1N1 a national emergency on Oct 24.
Expert with the ministry of health’s expert panel Xi Xiuming, said there is no reason for any panic but alertness is needed.
Central government has also been massively buying the H1N1 vaccines. And Hualan said it won an order for 11.21 million doses of its flu vaccine from the central government. Beijing Tiantan said it has won an order for 3.02 million doses. Sinovac Biotech received an additional order of 5.19 million.
New York listed company also gained 7.61 percent to close at $8.06 apiese on Monday and all the doses must be delivered by Dec 12.
Cai said that he still feels that the boom in H1N1 vaccine stocks stems largely from speculation, but there are two domestic companies can benefit from the new orders which are Beijing and Tiantan.
Li Yingpeng, the analyst of Galaxy Securities said that this is not the first ever rally of the vaccine sector. Since the H1N1 outbreak in Mexico in March, the pharmaceutical shares have risen many times however, that does not completely reflect their true performance. However for those companies which have won the vaccine orders, there will be substantial improvement in balance sheet. For example, a single dose is priced at 20 yuan, Hualan’s latest order can earn 200 million yuan, which may bring about 100 million yuan of profits.
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