Chengda pharmaceutical, the newly listed covid-19 drug concept leader, was elated in the capital market and received three 20cm limit in a row. The company’s account was full of grain overnight and was ready to spend 1.4 billion yuan to buy financial management.
On the evening of February 16, Chengda pharmaceutical announced that it planned to use idle raised funds of no more than 1.2 billion yuan and its own funds of 200 million yuan for cash management to buy products with high safety, good liquidity and a term of no more than 12 months. The company said that this move, implemented on the premise of ensuring the investment plan and capital safety of the raised funds, can seek more return on investment for the company and shareholders.
Chengda pharmaceutical, which was listed on the gem on January 20, has a P / E ratio of 83.1 times, and the net fund-raising after deducting the issuance expenses reached 1.621 billion yuan. However, the actual capital required for the company’s raised investment projects was only 513 million yuan, with an over raised ratio of 1.108 billion yuan, 216%. The issuance cost of the company is as high as 136 million yuan, of which Everbright Securities Company Limited(601788) recommendation and underwriting fee earned 118 million yuan.
idle funds buy wealth management
Chengda pharmaceutical announced that on February 16, 2022, the company held the 10th meeting of the 4th board of directors and the 6th meeting of the 4th board of supervisors, and deliberated and adopted the proposal on cash management with idle raised funds.
The announcement said that in order to make full use of the company’s idle raised funds, improve the utilization efficiency of funds and increase the return of funds, the company plans to use idle raised funds (including over raised funds) of no more than RMB 1.2 billion (including this amount) for cash management under the premise of ensuring that the normal progress of the investment plan of raised funds and the safety of raised funds will not be affected, for the purchase of high security, good liquidity Products with a term of no more than 12 months (including but not limited to agreement deposits, call deposits, time deposits, structured deposits and other cash management products). The service life shall not exceed 12 months from the date of deliberation and approval by the general meeting of shareholders of the company. Within the above limit and time limit, the funds can be recycled and used on a rolling basis.
On the same day, the company also deliberated and passed the proposal on using idle self owned funds for cash management.
The company said that in order to improve the use efficiency of idle self owned funds and increase the capital income of the company, the company agreed to use idle self owned funds of no more than 200 million yuan (including the capital) for cash management without affecting the normal operation of the company and ensuring the safety of funds, It is also used for “purchasing products with high security, good liquidity and a term of no more than 12 months (including but not limited to agreement deposits, call deposits, time deposits, structured deposits, purchasing financial products of financial institutions, etc.)”.
The company said that using idle raised funds and self owned funds for cash management can obtain certain investment income and seek more investment returns for the company and shareholders.
overcharged 1.1 billion
According to the latest financial report, by the end of the third quarter of 2021, the monetary capital in the company’s account was only 23.4 million yuan, far from “a small goal”, while accounts receivable and Inventory were increasing.
Successful IPO changed all this!
After two failed IPOs in 2011 and 2014, Chengda pharmaceutical did not give up. It finally approved the listing on August 10, 2021 and registered on December 7, 2021. It issued 24174000 RMB common shares to the public for the first time and was listed on the gem on January 20, 2022. The initial public offering price of the company is 72.69 yuan per share, the issuance price earnings ratio is as high as 83.1 times, and the total amount of funds raised is 1.757 billion yuan. After deducting the issuance cost of 136 million yuan, the net amount of funds raised is 1.621 billion yuan.
Among the 136 million issuance expenses, the sponsor Everbright Securities Company Limited(601788) took 118 million yuan. Before listing, the company paid the issuance fee of 14.52 million yuan in advance with self raised funds, and replaced it with raised funds after issuance.
How much does the company need to raise funds for investment projects?
Only 513 million yuan is needed, of which 100 million is still used to supplement the working capital. The actual planned capital invested in the raised investment project is about 403 million yuan, that is to say, the raised capital is 216%.
P / E ratio as high as 100 times
According to the prospectus, Chengda pharmaceutical mainly “provides cdmo services for key pharmaceutical intermediates for multinational pharmaceutical enterprises and pharmaceutical R & D institutions, and is engaged in the R & D, production and sales of L-carnitine series products”.
Although the P / E ratio of Chengda pharmaceutical is not low, it was just in time for the market to stir fry covid-19 test products and covid-19 specific drugs on January 20, giving birth to 14 times the big demon stock Andon Health Co.Ltd(002432) . In this context, the first day of the company’s listing also ushered in speculation: the share price fell from 72.69 yuan to 180 yuan, with a maximum increase of 147%. There were two temporary suspension in the session, and the closing fell, but the increase was also 77%.
The result of speculation continued to fall. Last Friday, the lowest price of the company fell to 62.7 yuan, below the issue price, and the higher point fell by two-thirds. However, at the beginning of this week, with the comeback of the concept of covid-19 specific drug, the company pulled out three 20cm trading boards in a row, closing at 109.21 yuan on February 16.
Previously, the company predicted the full year performance in 2021. Instead of the ultra-high net profit growth of 64%, 708% and 123% respectively in the three years before listing (2018-2020), the company turned to a decline of 13% – 15%, and the net profit fell in the range of 103 million yuan to 105 million yuan. According to the latest market value of 10.6 billion yuan, the company’s static P / E ratio exceeds 100 times.
In 2022, large-scale financial management should contribute a lot of investment income to the company. If the amount of 1.4 billion yuan is used up, even if calculated according to the latest 7-day annualized yield of 2% of yu’e Bao, there will be an income of about 28 million yuan. I don’t know whether the company can regain growth. But how much valuation is the market willing to give to the performance contribution from financial management? Only time can give the answer.
