Four pharmaceutical stocks, previously considered highly defensive, have shifted to an offensive stance with strong price increases – all driven by stories related to the sale of equity to strategic partners and/or state divestment.
Four pharmaceutical stocks, previously considered highly defensive, have shifted to an offensive stance with strong price increases – all driven by stories related to the sale of equity to strategic partners and/or state divestment.
With a solid foundation of stable growth and consistent dividends, the addition of strong catalysts has helped these pharmaceutical stocks outperform the market.
In this morning's trading session (February 11th), pharmaceutical stocks traded positively. IMP ( Imexpharm Pharmaceutical Joint Stock Company) surged to its ceiling price of 49,650 VND/share; DMC ( Domesco Medical Import-Export Joint Stock Company) also rose to its maximum limit of 86,600 VND/ share ; DBD (Binh Dinh Pharmaceutical and Medical Equipment Joint Stock Company - BIDIPHAR) increased by nearly 3%; and DHT ( Ha Tay Pharmaceutical Joint Stock Company) saw a slight increase of 1%…
Over the past year (up to February 8, 2025), IMP shares recorded a 67.54% increase, with an average trading volume of 101,000 units per session; DBD increased by nearly 39%, with a trading volume of over 220,000 units per session, showing a significant 28% increase in the last quarter of 2024; DHT recorded a price increase of 231.5% with an average trading volume of over 100,000 units per session; DMC impressed with two consecutive ceiling price increases (January 22-23, 2025) before the news of SCIC's share auction, also recording a better increase of over 45% in the past year, with a trading volume of just over 3,000 units per session.
Pharmaceutical stocks are generally known as defensive stocks due to their concentrated nature, stable growth through economic ups and downs, and regular, attractive annual dividends. Historically, these stocks only experience significant surges when there's a state divestment to welcome foreign shareholders. The foreign shareholder structure varies depending on the company and the stage of the process, but it's often a financial entity that later sells to strategic foreign pharmaceutical corporations. Each change in major shareholder ownership typically leads to a sharp rise in stock prices in this sector.
Overall, the pharmaceutical industry, in the period prior to the equitization and divestment of state-owned enterprises, witnessed major M&A deals between Domesco and Abbott, Hau Giang Pharmaceutical and Taisho, Imexpharm and SK Group, and changes in the major shareholder structure of Traphaco… More recently, there was the deal between Ha Tay Pharmaceutical and ASKA Pharmaceutical.
In 2024, although no major M&A deals took place, foreign investors continued to show positive expectations for the prospects of Vietnam's pharmaceutical industry by continuing to invest and increase their ownership stakes in pharmaceutical companies.
Investors continue to await the next wave of investment, which is expected to come from IMP following news that SK Group wants to transfer its shares; DBD is making progress in selling capital to a strategic investor, a process approved by the General Shareholders' Meeting for two consecutive seasons; DMC is awaiting news of state divestment; and DHT is seeing gradual increases in ownership by its major Japanese shareholder.
Given IMP's impressive upward trend, despite its characteristics as a stock group that receives little attention from individual investors due to its low price volatility, investment advisory rooms have seen a significant increase in buy recommendations based on technical analysis and positive fundamental information (such as growing business results) for IMP from 2024 to the present.
Similarly, with DHT, major shareholder ASKA Pharmaceutical Co Ltd. increased its ownership from 24.9% to 32.56% (December 2023) and continued buying shares throughout 2024 to increase its stake to 38.2%. In the early part of the year, it purchased an additional 1.41 million shares, raising its ownership to 39.94%. Currently, this Japanese shareholder is registering to purchase an additional 90,000 DHT shares in February.
Many investors in the market, as well as investment institutions, are "winning big" with this investment by correctly calculating and buying during the "increase in foreign shareholder ownership," also known as the "takeover game." However, due to the sharp price increase, many advisors do not recommend buying more DHT shares.
A similar situation can be seen at DBD, where major shareholder KWE Beteilgungen AG has continuously increased its ownership stake from 6.99% (March 2024) to 10.01% (December 2024). Currently, DBD is continuously contacting domestic and foreign investor groups to find a strategic investor to purchase 23.3 million shares issued through a private placement.
Many investment advisory groups have noted that these stocks have the potential to appreciate in value as the deals progress to more significant milestones.
IMP - previously shrouded in many "misconceptions" about gaming at IMP, which was finalized when SK Group was revealed as the controlling shareholder with a total ownership of 65% of the capital, has surprisingly seen its stock surge strongly in 2024, and according to Bloomberg, there is information about the possibility of selling these shares to another partner.
IMP is known as a reputable pharmaceutical manufacturing company, specializing in antibiotics (which account for a large proportion of its product portfolio), and boasts the most GMP-EU certified factories listed on the stock exchange. Currently, IMP has 4 factory complexes with 7 factories and production plants. Among them, IMP 2, 3, and 4 factories meet EU-GMP standards. The latest information indicates that IMP put the third production line at IMP4 into operation at the end of October. The company has received numerous pre-orders for IMP4 and expects its utilization rate to reach approximately 80% - 90% in the fourth quarter.
Imexpharm currently has a charter capital of VND 1,540 billion. The shareholder structure includes SK and related parties (KBA, Binh Minh Kim) owning approximately 64.8% of the capital. Vietnam Pharmaceutical Corporation holds 22% of the shares in IMP.
In Q4 2024, IMP recorded a record profit of VND 121 billion, an increase of 67%, contributing to bringing the 2024 profit to its highest level in history, at VND 321 billion.
DBD boasts an attractive product portfolio, comprising antibiotics, oncology drugs, and dialysis solutions – its three main treatment groups. Notably, DBD is the only listed pharmaceutical company with a significant competitive advantage in the oncology drug manufacturing sector. Compared to domestic competitors, DBD offers a diverse product range with approximately 20 different active ingredients, while other companies in the 3-5 drug group only offer 1-4 active ingredients for cancer treatment.
DBD inaugurated its injectable and tablet cancer drug manufacturing plant at the end of 2023, achieving WHO-GMP certification, and is currently applying for EU-GMP certification for these two production lines.
Upgrading production lines to EU-GMP standards, investing in the construction of two new factories, and government policies to streamline bidding regulations in the hospital channel have strengthened DBD's long-term prospects, based on the expectation of entering the market share of generic drugs in groups 1 and 2 – the two highest-revenue groups in the hospital bidding drug segment, and currently no Vietnamese cancer drug manufacturer has been able to enter this group.
In addition, DBD has signed an agreement with Crearene AG, a company based in Frauenfeld, Switzerland, to develop creatine-based treatment solutions for dialysis patients. Stock analysts assess that, as this is a completely new product, DBD will have many advantages due to its exclusive rights to the product.
In terms of business results, DBD continued its growth for another year with revenue of VND 1,727 billion and after-tax profit of over VND 275 billion. This result further strengthens the confidence of many investors that a company with a solid business foundation and competitive advantages will command an attractive price.
Meanwhile, DMC attracted attention earlier this year with the news that SCIC would divest its entire stake of nearly 35%, with a starting price of over 1.531 billion VND, equivalent to 127,046 VND per share. This price is significantly higher than DMC's current market price on the stock exchange (around 72,000 VND per share).
Many believe that the strongest candidate is DMC's current major shareholder, Abbott, which holds a controlling stake of over 51%. This transaction would not only reshape DMC's ownership structure but could also provide significant impetus to DMC's stock in the future.
If successful, this would be the largest share auction in the last two years since Petrolimex successfully auctioned off 40% of PGBank's capital in early April 2023.
However, it should be noted that in 2019, SCIC failed to sell its stake in this pharmaceutical company due to a lack of participating investors. At that time, the starting price for each share was VND 119,600, which was 64% higher than the market price of DMC shares at the same time.
Source: https://baodautu.vn/chuyen-the-tan-cong-goi-ten-tu-ma-co-phieu-nganh-duoc-d244752.html
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