A-share subscription | Xiaofang Pharmaceutical (603207.SH) starts subscription. The brand has various external medications such as glycerin suppositories, and natrum muriaticum solution.

On August 15th, Xiaofang Pharmaceuticals (603207.SH) started its initial public offering (IPO) with an issue price of 12.47 yuan per share and a subscription limit of 16,000 shares. The price-to-earnings ratio is 10.02 times and it is listed on the Shanghai Stock Exchange, with Guosen being its exclusive sponsor. According to the prospectus, Xiaofang Pharmaceuticals' main business is the research, development, production, and sales of topical medications. The company was established in 2002 and has continuously used the "Xinlong" trademark, which has high market recognition. The brand's various topical products such as enema, glycerin enema, calamine lotion, zinc oxide ointment, salicylic acid ointment, iodine glycerin, and ephedra nasal drops continuously maintain a leading market share. Currently, the company has a total of 63 drug approvals, with 12 being included in the national essential drug list and 28 covered by national medical insurance. The company's main product, enema, is listed as a low-priced drug within the pricing range determined by the National Development and Reform Commission. According to Minet data, the company's market share of enema is in a leading position. The market share of enema from 2019 to 2021 is as follows: During the reporting period, the breakdown of the issuer's main business revenue is as shown in the table below: It is understood that after deducting issuance expenses, Xiaofang Pharmaceuticals intends to use the raised funds for the following projects: In terms of finances, the company achieved operating income of approximately 340 million yuan, 361 million yuan, and 402 million yuan in 2019, 2020, and 2021 respectively. The net profit was approximately 142 million yuan, 160 million yuan, and 126 million yuan respectively. It is important to note that the prospectus specifically warns investors to pay attention to the risk of inventory depreciation. At the end of each reporting period, the company's inventory balance was 43.04 million yuan, 40.43 million yuan, 53.62 million yuan, and 50.65 million yuan, accounting for 17.12%, 14.21%, 13.89%, and 10.64% of total assets respectively. The company's inventory mainly consists of raw materials and stock products, accounting for 88.92%, 87.32%, 76.55%, and 86.08% of the inventory balance respectively. If there are changes in the market in the future leading to a decline in product demand or significant price decreases, there is a risk of inventory depreciation losses.