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DJ MARKET TALK: Sinopharm's Expansion Plan On Track - GuocoCapital
1147 [Dow Jones] STOCK CALL: GuocoCapital says Sinopharm's (1099.HK) share price has underperformed the H-share index by 6% since the release of disappointing financial results March 23.
It also underperformed the H-share index by about 20% since October when Shanghai Pharmaceuticals (601607.SH), one of its main competitors, announced plans for a listing in HK. But it believes the company's fundamentals remain sound, with its expansion plan on track.
"Five large-scale distributors, all ranked in the top 100 largest drug distributors in China, were acquired in 2010. The company had completed more than 12 significant acquisitions year-to-date reflecting an acceleration in the pace of expansion," the house says. It keeps the stock at Buy, with a target at HK$34.10 (30X FY12 P/E).
Source: Dow Jones Newswire