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Markets · IPO
Shanxi Dayu Biological Functions’s IPO to debut on Beijing Stock Exchange
2022/05/17 03:12:12

May 17, 2022 (China Knowledge) - Shanxi Dayu Biological Functions (871970) to start trading on the Beijing Stock Exchange May 18, tomorrow. The firm has issued 17.25 mln shares priced at RMB 10 per share raising RMB 172.5 mln. Its price-to-earnings ratio (PE) stands at 20.37. During subscription the IPO was 202 times oversubscribed.

Essence Securities acts as the lead underwriter and sponsor for the IPO.

Shanxi Dayu Biological Functions co.,Ltd. manufactures and distributes functional additives. The Company produces micro-ecological preparations, feed enzyme preparations and, feed products. Shanxi Dayu Biological Functions also produces veterinary drugs.

In FY 2020, Shanxi Dayu Biological Functions garnered a total revenue of RMB 145 mln, up 27% YoY. In terms of net income, it achieved RMB 33 mln, rising 18% YoY. In H1 2021, the company reported revenue of RMB 78 mln, a YoY increase of 92%, and its net profits reached RMB 11 mln, up 151% YoY.

The company is in the agriculture industry that is currently made of 104 counters in Shanghai and the Shezhen Stock Exchange with a total combined market capitalization of RMB 1,510 bln, industry’s average PE of 45 times. The agriculture industry’s index is down 15.20% year-to-date, ranking it the 28th place among all 29 broad industry groupings.

Yihai Kerry Arawana Holdings Co.,Ltd (300999) takes up the top spot in terms of sales in the industry, reporting RMB 194.92 bln of sales in 2020, with a net profit of RMB 6 bln, at 89 times PE. The second largest is New Hope Liuhe Co.,Ltd (000876), a total revenue of RMB 109.83 bln and a net profit of RMB 4.94 bln, at -5 times PE. Wens Foodstuff Group Co., Ltd. (300498) ranked third. It garnered a total revenue of RMB 74.94 bln last year, and a net profit of RMB 7.43 bln, with -6 times PE.

The average industry’s PE for the same or similar stocks on Hong Kong Exchange (HKEx) and the U.S. stock markets for agriculture is 14 times and 26 times, respectively. On a year-to-date basis, the industry’s index on the HKEx declines 11.38% and the U.S is up 29.11%.

There will be another 1 IPO debut tomorrow, Beijing Ctj Information Technology Co., Ltd. (301153).

Since January, a total of 127 companies have listed on either Shanghai or Shenzhen Stock Exchange, most are mainly in the machinery equipment, electronics and pharmaceutical and biological industries.

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