GMT EIGHT - IPOs

New stock news | Thinking on new energy sprints to the Hong Kong Stock Exchange, the flagship product SigenStor is the world's first five-in-one photovoltaic energy storage and charging integrated machine powered by AI.

According to the disclosure from the Hong Kong Stock Exchange on February 21st, Sige New Energy (Shanghai) Co., Ltd. (hereinafter referred to as "Sige New Energy") has submitted an application for listing to the Hong Kong Stock Exchange, with CITIC SEC and Banque Paris Bertrand as its joint sponsors. According to the prospectus, the company is a global leader in the field of renewable energy solutions. The company develops and provides innovative renewable energy solutions for homes and businesses. The flagship product SigenStor is the world's first AI-empowered all-in-one photovoltaic energy storage and charging system, using modular and stackable product design to seamlessly integrate photovoltaic inverters, DC charging modules, energy storage converters (PCS), energy storage batteries and energy management systems (EMS). Users can customize the capacity through simple stacking or module replacement to meet a range of energy needs for residential and commercial use, showing great flexibility and scalability. During the reporting period, sales of SigenStor contributed over 90% of the company's total revenue. According to a report from Frost & Sullivan, two years after its establishment, the company has become the world's leading provider of stackable distributed photovoltaic energy storage solutions based on product shipment volume, with a market share of 24.3% for the nine months ended September 30, 2024. For the nine months ended September 30, 2024, the company generated revenue of 699.7 million yuan, and according to the Frost & Sullivan report, it usually takes over five years for industry peers to reach this milestone. According to the Frost & Sullivan report, the company is the fastest-growing among all energy storage facilities in China in terms of reaching $100 million in annual revenue. In terms of financials, as of the full year of 2023 and the nine months ended September 30, 2023 and 2024, Sige New Energy's revenues were approximately 58.302 million yuan, 4.422 million yuan, and 700 million yuan respectively, while the losses for the year were 373 million yuan, 200 million yuan, and 53.354 million yuan respectively.

21/02/2025

New stock news | Foshan Haitian Flavouring and Food (603288.SH), Dongxin Marketing Technology, and other Hong Kong stock IPO application materials have been accepted by the China Securities Regulatory Commission.

On February 21st, the China Securities Regulatory Commission released the "List of Domestic Enterprises Issuing Securities Overseas and Listing Records (Initial Public Offering and Full Circulation) (as of February 21, 2025)". This week (February 17-21), Foshan Haitian Flavouring and Food (603288.SH), Dongxin Marketing Technology, Aux Group, Innovation International, Zhejiang Sanhua Intelligent Controls (002050.SZ), and Ningbo Joyson Electronic Corp. (600699.SH) submitted their Hong Kong IPO application materials to the China Securities Regulatory Commission for review.

21/02/2025

New Stock News | Shougang Langze plans to conduct an IPO in Hong Kong. The China Securities Regulatory Commission requires additional explanations on the detailed information of the pre-IPO guidance and filing for A-share listing.

On February 21, the China Securities Regulatory Commission announced the requirements for supplementary materials for overseas issuance and listing disclosure (February 14, 2025 - February 20, 2025). The CSRC requested Shougang Langze to provide detailed information on the previous A-share listing guidance filing and application, as well as the specific plan and arrangements for the A-share listing, and whether there are any significant impacts on the current issuance and listing. According to the Hong Kong Stock Exchange announcement on December 31, 2024, Shougang Langze submitted the application to the Hong Kong Stock Exchange and Guotai Junan International is the exclusive sponsor. At the same time, supplementary materials should explain whether the employee shareholding plan complies with relevant regulations and procedures for employee withdrawal and share transfer, and whether there are any disputes or controversies; if any, whether they pose obstacles to the current issuance. The supplementary materials should also clarify whether the relevant shares held by the shareholders applying for "full circulation" are pledged, frozen, or have any other defects. According to the prospectus, Shougang Langze was established in 2011, restructured as a joint-stock company and renamed in 2021. The controlling shareholders of the company are Shougang Group, NZ Tang Ming, and Caofeidian Fund. In the first half of 2024, revenue from sales of ethanol accounted for 74.6% of the company's revenue. The company produces ethanol from industrial exhaust gas as raw material, which can save food and reduce the use of arable land compared to traditional bioethanol. Frost & Sullivan report shows that the average cost of producing ethanol from grain from January to December 2023 is about 7000 yuan/ton; during the same period, Shougang Langze's average production cost for ethanol in China is about 4990 yuan/ton. In terms of performance, from 2021 to 2023, Shougang Langze's revenue increased from 258 million yuan to 593 million yuan. In the first half of 2024, revenue was 262 million yuan, a year-on-year decrease of 14.7%; the sales gross profit margin was -9.2%, a decrease of 21.3 percentage points compared to the same period. In terms of profit, the company has been continuously losing money since 2021, with losses of 49 million yuan, 24 million yuan, and 110 million yuan from 2021 to 2023 respectively; the loss in the first half of 2024 amounted to 94 million yuan, an increase of 379% year-on-year.

21/02/2025

New stock news | Hongxin Longgang's listing on the Hong Kong Stock Exchange and the approval of "full circulation" of domestically unlisted shares has been filed.

On February 20th, the China Securities Regulatory Commission issued the "Notice on the Overseas Issuance and Listing of Jiangsu Hongxin Supermarket Chain Co., Ltd. and the 'Full Circulation' of Unlisted Shares in China". Hongxin Long plans to issue no more than 61,596,000 ordinary shares for overseas listing and listing on the Hong Kong Stock Exchange. 35 shareholders of the company plan to convert a total of 160,684,910 unlisted shares in China into overseas listed shares, and list them on the Hong Kong Stock Exchange for circulation. According to the prospectus, Hongxin Long is a supermarket and convenience store chain operator headquartered in Yangzhou, mainly operating retail and wholesale business under the "Hongxin Long" brand in the central region of Jiangsu Province. The company's supermarkets offer various daily necessities (roughly divided into fresh, grains and oils, snacks, and household items) to meet customers' daily needs, while its convenience stores operate 16 or 24 hours a day to meet the demand for quick purchase of daily necessities.

21/02/2025

New stock news | It is rumored that Wuxi Lead Intelligent Equipment (300450.SZ) has selected a bank to arrange for its listing in Hong Kong, with a maximum fundraising of HK$3.9 billion.

Recently, media reported that Wuxi Lead Intelligent Equipment Co., Ltd. (300450.SZ), one of China's largest battery manufacturing equipment suppliers, has chosen a bank to help arrange a second listing in Hong Kong, potentially raising up to $500 million (approximately HK$3.9 billion). Sources familiar with the matter have revealed that the company is preparing for a stock issuance with the assistance of CITIC SEC and J.P. Morgan, and more banks may join the sponsorship work, with the earliest expected completion this year. The details, including the scale and timing of the listing, are still subject to change. Wuxi Lead Intelligent Equipment's clients include Contemporary Amperex Technology (300750.SZ), Panasonic Holdings, LG Chemical, and BYD Company Limited (01211). In January, Wuxi Lead Intelligent Equipment announced plans to seek a secondary listing in Hong Kong and list on the main board, after cancelling previous plans to issue Global Depositary Receipts in Zurich. The company's stock listed in Shenzhen has risen by 18% since the beginning of this year, with a market capitalization of approximately $5.1 billion.

21/02/2025

New Stock News | Meixue Bingcheng is expected to officially debut on the Hong Kong Stock Exchange on March 3, with Patient Capital appearing as a cornerstone investor.

On February 21st, Mixue Bingcheng Co., Ltd. disclosed a global offering announcement, announcing that the company will accept public subscriptions from February 21st to February 26th and start trading on the Hong Kong Stock Exchange on March 3rd with the stock code 2097. Mixue Bingcheng IPO plans to issue approximately 17,059,900 H shares, with 1,706,000 H shares publicly issued in Hong Kong and 15,353,900 H shares internationally. The offering price per share is HK$202.50, with a trading unit of 100 shares. Patient Capital Holding, Star Capital's second-round investment validates investment value In this IPO issuance, Mixue Bingcheng has attracted 5 cornerstone investors with a total subscription of 200 million US dollars (approximately 15.58 billion Hong Kong dollars), making the investment team quite luxurious. Among the cornerstone investors of Mixue Bingcheng, M&G Investments is particularly noteworthy, with a total investment of 60 million US dollars. Data shows that M&G Investments is affiliated with the British investment giant M&G plc, a company formed by the merger of PRU Group's UK and European savings and insurance business and its wholly-owned international investment management company M&G, with approximately 4.6 million clients in the UK, Europe, America, and Asia as of June 30, 2024, managing assets of 346.1 billion pounds. It is worth mentioning that M&G plc announced the launch of a Chinese stock fund before the strong rise in A-shares in September last year, hitting the right timing for A-share investments. Analysts point out that as a leading investment institution, M&G is known for its cautious, stable, and value-oriented investment style seeking long-term returns, with relatively longer investment periods and rarely seen in the domestic capital market. Industry insiders believe that M&G's heavy position in Mixue Bingcheng not only reflects M&G's recognition of the long-term development value of Mixue Bingcheng but also reflects its continued optimism for the Chinese consumer market. In addition to M&G Investments, Sequoia China, which has long been engaged in the consumer investment sector, also appeared in the lineup of cornerstone investors. The institution has previously invested in many ready-to-drink beverage companies and once again subscribed for 60 million US dollars, confirming its confidence in the development of the Chinese ready-to-drink beverage industry. Another institutional investor, Persistence Growth Limited under Boyu Capital, invested 40 million US dollars to subscribe for 1,538,500 shares, reinforcing its focus on early market layout and high-growth industries, with investment cases including Alibaba, Meituan, Didi, Kuaishou, NetEase Music, and other well-known companies. Industry experts believe that Boyu Capital's presence in the Mixue Bingcheng's cornerstone investor lineup is a reaffirmation of the company's continued growth and inherent value. Furthermore, the increased investment of Hillhouse Capital and Dragon Ball Capital further affirmed the development prospects of Mixue Bingcheng. It is reported that the two institutions had already become investors of Mixue Bingcheng through Pre-IPO rounds, witnessing and accompanying the development of Mixue Bingcheng. Deepening the supply chain to create the ultimate cost-performance, laying a solid foundation for long-term scale development Since its founding in 1997, Mixue Bingcheng has a different development background from other mainstream ready-to-drink beverage companies in China. The company first started as a small shop called "Hanliu Shaved Ice" in Zhengzhou, and was the earliest in the Chinese ready-to-drink beverage industry to establish a central factory, to build its exclusive logistics system, and to cross-category establish a freshly-ground coffee brand (Lucky Coffee). As early as 2012, Mixue Bingcheng established a central factory to extend its business to the upstream manufacturing field. After more than ten years of continuous cultivation, Mixue Bingcheng has built five large production bases covering a total area of approximately 790,000 square meters, covering a full range of ingredients including sugar, milk, tea, coffee, fruits, grains, and ingredients. It is reported that Mixue Bingcheng is one of the very few brands in the Chinese ready-to-drink beverage industry that achieves 100% procurement of drink ingredients, packaging materials, and equipment from the brand by franchisees, with over 60% of the drink ingredients provided to franchisees being self-produced, the highest in the Chinese ready-to-drink beverage industry (according to the report of Zhaoshi Consulting), with core drink ingredients being 100% self-produced. In addition to the central factory, Mixue Bingcheng also began early to layout in the procurement and logistics fields to continuously improve the supply chain system. The company further extended its procurement network upstream to Shenzhen Agricultural Power Group in 2013, and began to build its own exclusive logistics system in 2014, having now created the largest-scale end-to-end supply chain system in the Chinese ready-to-drink beverage industry, with procurement networks covering six continents, 38 countries globally, and logistics networks covering 31 provinces, autonomous regions, and municipalities, over 300 prefecture-level cities, 1,700 counties, and 4,900 towns in mainland China. As of September 30, 2024, Mixue Bingcheng has achieved 12-hour reach in over 90% of the county-level administrative divisions in mainland China. The perfect supply chain system not only ensures high-quality drink ingredients and stable supply, optimizes cost structure effectively, and enhances the company's operational efficiency, laying the foundation for Mixue Bingcheng's adherence to the principle of "high quality and affordable" products; this system also provides necessary support for Mixue Bingcheng to further expand its business scale. As of December 31, 2024, Mixue Bingcheng has a total of 46,479 stores in China and overseas, making it the world's largest ready-to-drink beverage company based on the number of stores as of September 30, 2024, with an end retail sales of 228 billion yuan, 307 billion yuan, 478 billion yuan, and 583 billion yuan in 2021, 2022, 2023, and 2024, respectively, and the number of cups sold reaching 3.6 billion, 4.7 billion, 7.4 billion, and 9 billion during the same period. The cups sold and end retail sales in 2024 increased by 21.9% and 21.7%, respectively, compared to the previous year. With a huge scale, Mixue Bingcheng has also achieved strong growth and excellent profitability. In 2022, 2023, and 2024, Mixue BingchengNine months before the year, the company achieved revenues of 13.6 billion yuan, 20.3 billion yuan, and 18.7 billion yuan respectively, with year-on-year growth of 31.2%, 49.6%, and 21.2% respectively. During the same period, net profits were 2 billion yuan, 3.2 billion yuan, and 3.5 billion yuan respectively, with year-on-year growth of 5.3%, 58.3%, and 42.3% respectively."Bonjour, comment a va?" "Hello, how are you?"

21/02/2025

New stock news | Shubao International's Hong Kong IPO has been filed

On February 20th, the China Securities Regulatory Commission issued a notice of filing for the overseas listing of Soft International Group Ltd. Soft International intends to issue up to 937,500,000 shares of overseas listed common stock and list on the Hong Kong Stock Exchange. According to the prospectus, Soft International is mainly engaged in the development, production, and sales of disposable sanitary products for individual use in China, focusing on infant and child care products in the emerging markets of the Eurasian continent. According to a Frost & Sullivan report, based on the export value in 2023, Soft International is the second largest exporter of infant and child care disposable sanitary products from China to Russia, accounting for approximately 3.7% of the market share in China's infant and child care disposable sanitary products exports in 2023.

20/02/2025

New Stock News | Zhengli New Energy Hong Kong Stock Listing and Domestic Unlisted Shares "Fully Circulated" Approved for Filing

On February 20, the International Cooperation Department of the China Securities Regulatory Commission issued the "Notice on the Filing of Overseas Issuance and Listing of Jiangsu Zonergy Co., Ltd.'s Unlisted Shares in China for Full Circulation". Zonergy plans to issue no more than 484,415,700 shares of ordinary shares for overseas listing on the Hong Kong Stock Exchange. The company's 30 shareholders intend to convert a total of 1,317,849,039 unlisted shares in China to overseas listed shares for circulation on the Hong Kong Stock Exchange. The prospectus shows that Zonergy is a Chinese manufacturer of lithium-ion batteries, developing a diverse portfolio of battery products driven by market demand and technology. The company mainly focuses on the sale of battery products for electric vehicles (EVs). It provides integrated solutions for battery cells, modules, battery packs, battery clusters, and battery management systems, aiming to expand the large-scale application of electrochemical products in the land, sea, and air interconnected (LISA) industries. According to the data from the China Automotive Power Battery Industry Innovation Alliance, as of August 31, 2024, the company holds a 1.7% market share in the battery manufacturing industry among China Shipbuilding Industry Group Power manufacturers in terms of installed capacity over the eight months up to the specified date.

20/02/2025

New stock outlook | Holding on to the performance of international food and beverage giants is still trapped in a bottleneck, and New Qian's new IPO in the "sweet dilemma" landscape.

In human history, the discovery and popularization of sugar can be said to be one of the significant events with far-reaching impacts. From being a luxury item to becoming a daily necessity in modern society, sugar has not only reshaped human dietary structure, but also profoundly influenced the global economic landscape, social relationships, and cultural forms. Broadly speaking, sugar can be divided into edible sugar and sweeteners. The latter refers to substances that can provide sweetness in food with a small amount, and its main characteristics include low dosage, high sweetness, low or even zero energy. Due to the health burden of excessive sugar intake, in recent years, with the improvement of people's health awareness, a "reduced sugar" trend has swept through many countries and regions worldwide. According to reports from Zhaoshi Consulting, the sales of artificial sweeteners increased from 143,000 tons in 2018 to 176,100 tons in 2023, with a compound annual growth rate of 4.2%. In terms of sweetness contribution, artificial sweeteners accounted for over 80% of the global sweetener market in 2023. By 2028, the annual sales volume of this market is expected to reach 215,500 tons. As the industry continues to grow, the movements of related companies in the capital market are also worth paying attention to. GMTEight noticed that recently, Xinqian Technology Co., Ltd. (referred to as "Xinqian") submitted an application for listing on the main board of the Hong Kong Stock Exchange. It is reported that Xinqian's business can be traced back to 2003. After more than 20 years of development, the company is currently ranked first in the world in the food-grade aspartame manufacturing industry and fifth in the world in the sucralose manufacturing industry. However, despite its outstanding position in the industry, Xinqian's performance has been unstable. Looking back at the financial data, the company's revenue significantly declined in 2023, and the net profit index has been negative for two consecutive years. Prior to this application, Xinqian had previously attempted to list on the Hong Kong stock market but failed to do so within the deadline. Now, after half a year, can the revitalized Xinqian impress the market? Product price fluctuations affect financial performance In terms of business composition, Xinqian's revenue mainly comes from three major product categories: food-grade aspartame, industrial-grade aspartame, and sucralose. From 2022 to 2024, the sales of sucralose accounted for 49.6%, 51.1%, and 41.8% of Xinqian's total revenue, the sales of food-grade aspartame accounted for approximately 40.6%, 40.1%, and 42% of the total revenue, while the sales of industrial-grade aspartame accounted for 7.6%, 6.1%, and 11.7% respectively. It can be seen that Xinqian's revenue mainly relies on sucralose and food-grade aspartame. However, as a commodity, the international market price of sugar fluctuates greatly, and sweeteners are no exception. In recent years, the market prices of food-grade aspartame and sucralose have shown significant fluctuations. Firstly, in terms of food-grade aspartame, as the supply-side capacity gradually recovered and downstream producers stockpiled due to concerns about price increases, which led to a decline in demand, the average export market price of food-grade aspartame dropped significantly from around 22,991.3 yuan per ton in 2022 to 14,842.9 yuan per ton in 2024. As for sucralose, due to the active production expansion strategy adopted by the main producers, the market has been in a situation of oversupply. In addition, in order to maintain their market share and to prevent small competitors from entering the market that could disrupt the balance, leading companies initiated price wars in 2022. Data shows that the average export market price and average domestic market price of sucralose both fell from 386,261.6 yuan/ton and 378,556 yuan/ton in 2022 to 141,597.3 yuan/ton and 148,904.9 yuan/ton in 2024. Amidst the continuous decline in market prices, Xinqian could only adapt to the market. For sucralose, from 2022 to 2024, the average selling prices of this product were 311,663 yuan/ton, 236,811 yuan/ton, and 184,802 yuan/ton. As a result, the sales revenue of Xinqian's main products has been affected to varying degrees. In terms of sucralose, the revenue for the reporting period was 377 million yuan, 228 million yuan, and 237 million yuan, respectively, while the revenue for food-grade aspartame was 309 million yuan, 179 million yuan, and 239 million yuan during the same period. With the significant decrease in revenue contribution from its "star" products, it is no wonder that Xinqian faces considerable downward pressure on its core financial data. From 2022 to 2024, the company's total revenue was 761 million yuan, 447 million yuan, and 569 million yuan, respectively. Although the revenue in 2024 showed some recovery, it is still far from the peak in 2022. In terms of profit indicators, the gross profit margin for these three years was 25.6%, 17.9%, and 17.9%, indicating significant profit pressure. Meanwhile, the net profit was 122 million yuan, 44.662 million yuan, and 43.406 million yuan, respectively, demonstrating a continuous decline. Uncertain effects of expanding overseas markets As a leading company in the subdivided industry, Xinqian has a stable and diversified customer base globally, including many well-known multinational companies. Although the company did not disclose the names of its customers directly, it can be inferred from the description in the prospectus that Coca-Cola and Nestl are among Xinqian's customers. However, despite being deeply connected with some of the world's top food and beverage companies, Xinqian cannot exempt itself from the impact of the sweetener price war. Perhaps due to being caught in the rat race, Xinqian has stated that its focus in the future will be on "continuing to prioritize overseas markets." Specifically, Xinqian plans to expand the production scale of sucralose in its factory in Thailand and plans to produce isomaltulose in the factory. In addition, the company is also preparing to expand its international sales network. As of now, Xinqian's factory in Thailand has the capacity to produce 500 tons of sucralose per year. The core reason why the company plans to further expand the sucralose production in the Thailand factory is that the international price of sucralose is generally higher than the domestic price, thus providing a greater profit margin for selling this product overseas. Furthermore, according to public information, global marThe demand for trichlorosucrose is still growing rapidly, and it is expected that the market size of this product will reach 29,100 tons by 2028. The compound annual growth rate from 2023 to 2028 can reach 7.8%. Expanding the production scale of the Thai factory will undoubtedly help Nuqian further enhance its "voice" in the overseas market.In addition to seizing the expansion opportunities of its own advantageous products, Xinqi'an has also set its sights on isomaltulose. It is reported that Xinqi'an plans to produce this product in its factory in Thailand in the next step, with an expected annual production capacity of 15,000 tons. In terms of supporting sales channels, Xinqi'an is currently establishing new sales offices in the United States, the Netherlands, Thailand, and Indonesia to expand its international sales network. Meanwhile, the company also plans to expand its sales office in Shenzhen and turn it into the global sales headquarters. From the various signs above, the future growth performance of Xinqi'an will largely depend on the business capabilities of its overseas factories, especially the one in Thailand. As for Xinqi'an's long-term strategy, listing on the Hong Kong stock market is probably essential, as Hong Kong, as a world-renowned free trade port and a major international financial center, will add a lot to Xinqi'an's internationalization strategy. However, it should also be noted that at the current stage, Xinqi'an's performance stability is poor, and the company's growth performance still heavily relies on the industry's economic conditions. While expanding production can elevate Xinqi'an's scale, the supply-demand relationship of related products is already in a delicate balance. After leading companies continue to expand production, how much "price dividend" can be left in the overseas market is probably a question that needs to be answered.

20/02/2025

New Stock Preview | Losses exceed 800 million yuan in two years, it is difficult for the first domestic oral drug for COVID-19 to continue to grow, Real Bio is in a financial dilemma.

On February 18, the Hong Kong Stock Exchange disclosed that True BioTech Limited (hereinafter referred to as "True Bio") officially submitted its application, with CICC as its exclusive sponsor. It is understood that this is not the first time True Bio has knocked on the door of the Hong Kong Stock Exchange. As early as August 4, 2022, True Bio had submitted its IPO application materials to the Hong Kong Stock Exchange. Single commercialized product: oral medication for COVID-19 Losses exceeding 800 million yuan over two years The prospectus shows that True Bio is a biotechnology company driven by innovative research and development, focusing on the development, manufacturing, and commercialization of innovative drugs for the treatment of viral infections, tumors, and cardiovascular and cerebrovascular diseases. It is understood that True Bio's core product, Azufding, is the first domestically produced oral medication for COVID-19. As a Class 1 original drug, Azufding obtained conditional approval for the treatment of HIV infection in July 2021 and conditional approval for the treatment of COVID-19 in July 2022 from the National Medical Products Administration, becoming the first oral antiviral drug developed by a Chinese company approved by the National Medical Products Administration for the treatment of COVID-19. It is expected to complete Phase III clinical trials after listing in the second half of 2025. According to Frost & Sullivan, Azufding is the world's only oral nucleoside antiviral drug targeting two sites for the treatment of HIV. Currently, Azufding has sold over 10 million bottles. The company has established its own production facility with an annual capacity of about 3 billion tablets of Azufding. The facility has received GMP certification and can fully meet the current commercialization needs. In terms of performance, over the past two years, almost all of True Bio's revenue has come from sales of Azufding to Shanghai Fosun Pharmaceutical. According to the prospectus, in 2023, True Bio had only one customer, Shanghai Fosun Pharmaceutical, with total sales of 344 million yuan; in 2024, Shanghai Fosun Pharmaceutical accounted for 99.2% of total revenue, with total sales of 236 million yuan. In 2023 and 2024, True Bio recorded operating revenues of 344 million yuan and 238 million yuan, respectively, a year-on-year decrease of 30.89%. True Bio has not yet achieved profitability, with losses of 784 million yuan and 40.042 million yuan in 2023 and 2024 respectively, totaling 820 million yuan over two years. True Bio stated that the continued losses were mainly due to considerations for the expiration date and marketability of the product, resulting in a significant reduction in inventories and therefore gross losses; at the same time, significant R&D expenses for core products and other candidate drugs, administrative expenses, and fair value losses on convertible redeemable preference shares also had an impact. In addition, the decrease in losses compared to the previous year was due to a reduction in inventory reduction and recorded gross profit. It can be seen that the market growth for the first oral medication for domestic COVID-19 is nearing its peak, and despite a decrease in losses in 2024, profitability has not yet been achieved. If the profitability situation cannot be improved in the short term, it may affect investor confidence and the post-listing performance of the stock. In the field of tumor treatment, True Bio has found that its core product, Azufding, has broad-spectrum anti-tumor activity and is the only nucleoside anti-tumor drug with dual mechanisms and high selectivity developed in the past 30 years. It exerts dual anti-tumor effects by inhibiting DNA synthesis in tumor cells and regulating immune system function. In addition, True Bio's ZS-1003 project developing TOPO1 inhibitors uses a pioneering non-camptothecin structure, demonstrating broad-spectrum anti-tumor activity. The drug has unique advantages in overcoming common anti-tumor drug resistance. Preclinical studies have shown that its inhibitory effect on irinotecan-resistant tumor cells is 400 times that of irinotecan, and it is expected to be widely used as a novel toxin in various XDC (such as ADC, PDC, SMDC, etc.) linked drug projects, providing an effective solution for resistance in various tumors. From 2021 to 2022, True Bio conducted two rounds of financing, with a total financing amount of 712 million yuan, with investors including Jinbailing Investment, Yifeng Capital, Yingke Capital, Yashang Capital, Fuqiang Financial, and Shanghai Disano Pharmaceutical Co., Ltd. After completing the Series B financing in 2022, the company's post-investment valuation reached 3.56 billion yuan. In summary, True Bio's financial data is not impressive, with the highlight being the Azufding oral medication for COVID-19. However, in the face of continued losses, True Bio has reduced its research and development investment, with research and development expenses of 238 million yuan and 151 million yuan in 2023 and 2024, respectively. From a research and development perspective, most of True Bio's product pipeline is in the early clinical stages, transitioning candidate drugs into later-stage clinical trials and advancing preclinical programs to clinical trials. Continuing to expand clinical development of candidate drugs to treat more indications, it can be foreseen that it will continue to generate substantial research and development expenses. At this point, tightening research and development expenses, it is clear that True Bio is in a financial dilemma: on one hand, there have been huge losses over the past two years, and on the other hand, the company's funds are tight. As of the end of 2024, the company's cash and cash equivalents were only 321 million yuan, and at the current "burn rate," these funds will not last long. With Azufding as the core layout of three major pipelines: HIV, anti-tumor, and central nervous system True Bio has established HIV and anti-tumor drug pipelines centered around Azufding and is also expanding into the central nervous system field. For example, in the HIV drug field, True Bio expects to complete Phase III clinical trials for Azufding to treat HIV infection by 2025. Another new oral HIV candidate drug in development, CL-197, is expected to complete Phase I trials in 2025 and is planned to submit an IND application for CL-197 overseas. The combined use of Azufding/CL-197 compound tablets has the potential to become important in theACL B3.6ultimate solution for patients who are resistant to traditional drugs for the treatment of ACL; especially when used in combination with chemotherapy in the treatment of advanced gastrointestinal tumors, it is expected to solve the problem of patients' inability to tolerate side effects. At the same time, the 360 million yuan raised from the Series B financing will be used primarily to advance research and development processes, clinical trials, sales, and market expansion, providing financial security for the company's next steps.The world's first long-acting, once-weekly oral HIV treatment medication.According to Frost & Sullivan data, HIV is a virus that primarily attacks and destroys the immune system's CD4+ T cells, making patients more susceptible to infection and other diseases. The HIV infection process is divided into four stages, from acute infection to latency and pre-AIDS, and then to late-stage AIDS, also known as acquired immunodeficiency syndrome or AIDS. Based on genetic differences, HIV can be divided into two main types: HIV-1 and HIV-2. HIV-1 is the most common type, accounting for over 90% of global HIV infections. There is currently no cure for HIV infection, but the progression of the disease can be suppressed or slowed down through drug therapy. The HIV drug market in China and globally continues to grow, increasing from $35.3 billion in 2018 to $43.1 billion in 2023, with a compound annual growth rate of 4.1%. It is projected to grow at a rate of 4.7% to $59.5 billion by 2030. In recent years, newly approved and more effective and safe cART drugs have become the most widely used HIV drugs globally. In the Chinese market, most HIV drugs are single-agent antiretroviral drugs, rather than the combination drugs containing multiple ART agents that are more easily available in developed markets. As a type of NRTI (a class of antiretroviral drugs widely used as backbone drugs in first-line cART regimens), azidothymidine may interact with drugs of different mechanisms to form various cART regimens, thus single-agent antiretroviral drugs of different categories (such as NNRTI or INSTI) are not considered substitutes or competitive products for azidothymidine. Therefore, with the growth of the HIV drug market, the market demand for azidothymidine is expected to continue to increase. However, as mentioned by True Biotech, most of the company's drug combinations are currently in pre-clinical or clinical development stages, so their business depends on whether they can successfully develop drugs and candidate drugs for the treatment of viral infections, tumors, and cardiovascular and cerebrovascular diseases. In other words, if True Biotech can successfully go public, its stock price will rely on azidothymidine in the coming years. In conclusion, as the last train of the COVID-19 "dividend" arrives in 2022 with the introduction of oral COVID-19 drugs, True Biotech still fails to make an IPO in Hong Kong. Having missed the best time to go public, the risks associated with True Biotech's reliance on a single drug cannot be overlooked.

19/02/2025

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