AsiaPharm will be growth in the longer term.
During that period Q306 & Q406 AsiaPharm Share price dropped is because one of AsiaPharm's major revenue contributor Maitongna's specification has suddenly changed by the China government, 25ml drug can not be sold any more. In some hospitals if there are 25ml drug available, because AsiaPharm can not sell 25ml now and to sell other 5ml, 10ml, 15ml drugs, they have to wait for next time to rebid to enter into those hospitals. So it will take times to recover the sales and 2q and 3q06 will be affected most. 4q 06 most hospital will start rebidding. Since Maitongna is the market leader so AsiaPharm would be able to covering to the pre-drop level.
strength of AsiaPharm:-
Strong management
-Long term vision
-Transparent
-CFO/internal auditor
Healthy company structure.
-Strong R&D
-High standard manufacturing
-Self owned distribution team
-Healthy financial position
The China Regulation changes and improve market efficiency.
-Healthy competition
-Mergers & Acquisition (M&A)
What I feel that AsiaPharm shares price will hit all time high in the coming future as the business in China getting better. AsiaPharm is going for a long term ride.
AUDITORS
Ernst & Young
BACKGROUND
The Company was incorporated under the laws of Bermuda on 2 July 2003. It is the holding company of AsiaPharm Investments Ltd which owns 95.93 percent of the shareholdings of Shandong Luye Pharmaceutical Co Ltd. Shandong Luye owns 69 percent and 80 percent of the shareholdings of Shandong Luye Natural Drug Research and Development Co Ltd and Yantai Luye Drugs Trading Co Ltd respectively.
The Group is in the business of:
(1) research, development, production and sale of pharmaceutical drugs for the fields of orthopaedics, neurology, gastroenterology and hepatology, focusing on natural drugs and chemical drugs with new formulations;
(2) distribution of products of other pharmaceutical manufacturers in China;
(3) processing and sale of active ingredients, mainly chondroitin sulphate, for the manufacture of pharmaceutical drugs;
(4) sale of R&D results and/or patents of new drugs and provision of research services on a contract basis.
Summary
AsiaPharm Group Ltd. is a specialty pharmaceutical group in the Peoples Republic of China. It specializes in the research and development (R&D), production and sale of pharmaceutical drugs and formulations for chemical drugs, the sale of research and development results and patents for drugs, and the provision of research services on a contract basis. Its distribution network includes 35 sales support offices, covering 30 provinces, municipals and autonomous regions, reaching approximately 2,000 hospitals. Its core products include Lutingnuo, Maitongna, Nuosen, Okai, Sidinuo and Ximingting. In May 2006, the Company's wholly owned subsidiary, Shandong Luye Pharmaceutical Co., Ltd (Luye), acquired the remaining 20% minority interest in Luye's subsidiary, Yantai Luye Drugs Trading Co.
Referece:-
http://ir.asia1.com.sg/asiapharm/stbtnews.html
http://www.listedcompany.com/ir/asiapharm/newsroom/newsroom.cgi?news_cat=News%20Release&
Asiapharm Group Limited: Upgrade to Strong Buy
