for the CXO sector, the beginning of 2022 is not friendly.
Following the first trading day of the new year, after the "black door", just after the lunar new year, I saw many enterprises that could usher in the rise of share price with high-quality performance, and encountered the "black swan" from the United States, and the market value was "evaporated" again!
blood washed again
Last December, due to a rumor of "entity list", the stock price of pharmaceutical outsourcing sector (CXO) was "scared green" and stopped falling after clarification.
This time, the wolf came again! After the opening on February 8, the A-share and Hong Kong stock CXO sectors all fell, and the Hong Kong stock Yaoming biological once plunged 30%, and then resolutely suspended trading. Asymchem Laboratories (Tianjin) Co.Ltd(002821) , Pharmaron Beijing Co.Ltd(300759) , Joinn Laboratories (China) Co.Ltd(603127) all fell by more than 10%; In terms of a shares, Wuxi Apptec Co.Ltd(603259) was killed by mistake and fell by the limit, Pharmaron Beijing Co.Ltd(300759) fell by more than 12%, both Joinn Laboratories (China) Co.Ltd(603127) and Asymchem Laboratories (Tianjin) Co.Ltd(002821) fell by more than 9%, and Hangzhou Tigermed Consulting Co.Ltd(300347) fell by more than 5%.
After the whole sector was bloodwashed, Yaoming company responded to investors' questions for the first time. Among them, Wuxi Apptec Co.Ltd(603259) issued a clarification announcement at noon, saying that neither the company nor its subsidiaries were included in the "unconfirmed list" by the U.S. Department of Commerce, and the current production and operation of the company is normal.
In fact, the two subsidiaries of YaoMing biology are really included in the list. Yaoming biological company wrote in a statement provided to the reporter of the international finance news: "its two subsidiaries were included in the" unverified list "of the U.S. Department of Commerce on February 8, 2022. This list is mainly based on the fact that U.S. agencies cannot verify the legitimacy and reliability of all parties receiving U.S. exports. This list is not an" entity list "or" blacklist " (Black List)。”
Yao Mingsheng frankly said, "In the past ten years, Yaoming bio has been approved by the US Department of Commerce to import some disposable bioreactor controllers and hollow fiber filters. We strictly abide by relevant export regulations and have never re exported or resold to any other legal entity. The US Department of Commerce has made reasonable use of these products (i.e. self-use, no resale) There is a routine verification procedure, but it cannot be completed in time in the past two years due to the covid-19 pneumonia epidemic. " However, the company stressed that the services provided by Yaoming biology to global customers will not be affected by the inclusion of the two companies in the "unverified list", and all businesses are advancing steadily.
On how to solve the "list" problem in the next step, Yao Mingsheng said, "After the construction of the facilities where Wuxi Yaoming Biotechnology Co., Ltd. and the subsidiaries of Shanghai Yaoming Biotechnology Co., Ltd. are located, there is no need to import relevant instruments and equipment, and other legal entities of YaoMing biotechnology are not included in the list. We are ready to respond to the verification and inspection of the U.S. Department of commerce at any time, and are also actively taking temporary measures to remove the two companies from the United States before the inspection Removed from the 'unverified list'. "
How does affect
Why does a message scare the whole CXO sector? On the one hand, investors still remember the ZTE event in 2018. On the other hand, CXO enterprises have been favored by institutional investors such as public funds because of their high performance. A slight negative storm will lead to panic.
Then, what is the difference in the actual impact of the words "unconfirmed list", entity list and "blacklist" repeatedly emphasized by "Yaoming" enterprises?
Public information shows that the list of U.S. export control mainly includes three types: entity list (ENT), rejected person list (DPL) and unconfirmed list (UVL). Some insiders said that although the negative impact of the unconfirmed list is lower than that of the entity list and the rejected list, being listed in UVL will still bring some negative effects to the enterprise.
First, the entity enterprises on the unconfirmed list cannot receive the items exported, re exported or transferred from the United States through licensing;
(II) when the transaction with the exporter is not confirmed by an individual or is not required to be kept under the export regulation, even if the transaction is conducted with the exporter under the above-mentioned regulation;
Third, if U.S. exporters export tangible things under ear control to entity enterprises in UVL, regardless of the final destination or amount of the goods, they need to declare the electronic export information (EEI) in advance in the automatic export system (AES);
Fourth, the supply chain stability of enterprises listed in UVL may be impacted. For enterprises listed in UVL, all parties to the transaction will conduct due diligence on them. U.S. exporters and companies will treat these entities with a more cautious attitude. In order to reduce risks, they will even choose to refuse to cooperate with Chinese enterprises listed in UVL.
It can be seen from the above points that in order not to upgrade to the entity list, the two subsidiaries of YaoMing biology must take action as soon as possible and remove them from the UVL list as soon as possible, so as to reduce losses.
Some insiders believe that at present, the most direct impact of this UVL list on Yaoming biology is that its plan to build large-scale capacity in the United States may be affected, and the company may need to increase suppliers of upstream raw materials and equipment in other parts of the world in the future.
At the investor meeting held on the morning of February 8, Dr. Chen Zhisheng, CEO of YaoMing biology, said that the "entity list" and "blacklist" have a heavy impact, which will involve the inability to invest in the United States, while the "unverified list" of YaoMing biology's subsidiary will involve some imported disposable reactor controllers and hollow fiber filters, It mainly affects the import of these two consumables. The CEO said, "our two plants have developed relatively mature and are not affected. At present, the reactors of all plants under construction have been in place. There are four suppliers of ultrafiltration membrane all over the world, which is just a matter of replacement."
so when can Yao Ming creatures be removed from the list?
From today's investor communication, there is no specific deadline for this list. Everything needs to wait for the on-site verification results of the Industrial Security Administration (BIS) of the U.S. Department of Commerce.
From the perspective of historical cases, there are often precedents for Chinese enterprises to be removed from the list. For example, on October 9, 2020, the industrial security administration of the U.S. Department of Commerce issued an amendment to the unverified list. 26 entities were added to the 40 new entities, 16 of which were removed from Chinese mainland. It is reported that these enterprises were removed from the list mainly because the United States carried out end-use verification on the entities and verified their "bona fide".
In addition, on April 11, 2019, the US bis included 37 Chinese entities in the UVL list, including listed companies represented by Beijing Bayi Space Lcd Technology Co.Ltd(688181) , Sanan Optoelectronics Co.Ltd(600703) . After a lapse of three months, on June 26, 2019, the US bis revised the export administration regulations and removed eight companies such as Beijing Bayi Space Lcd Technology Co.Ltd(688181) , Sanan Optoelectronics Co.Ltd(600703) from the UVL list.
