Wuyi Pharmaceutical Holdings, a small Fujian province-focused drugmaker due to list in Hong Kong next month, plans to expand nationally this year to enlarge its penetration amid an increasingly competitive operating environment, sources close to the company's initial public offering said.
'It's the most effective way to maintain high earnings growth over the next few years,' one source said.
The manufacturer and seller of Western and traditional Chinese medicine plans to raise as much as US$100 million from an offering to fund the expansion of its distribution channels across the mainland, as well as for product research and development.
The company, based in Jianyang, Fujian, launched the pre-marketing of its offering on Monday and will hold a small group briefing today for local investors.
Bookbuilding will take place in the middle of next week, followed by the public offering slated for the third week of this month, sources said. Trading is set to begin in the first week of February.
Deal arranger UBS said in a research report it expected Wuyi's earnings last year had increased 53 per cent to 180 million yuan from 117 million yuan a year earlier on the back of tax concessions and a higher profit margin.
