[HK IPO Subscription] Baiji Pharmaceutical-B Subscription Strategy

This afternoon, the grey market trading of $TIANYU SEMI(02658.HK) and $XIAO NOODLES(02408.HK) was really two big bowls of noodles, it's really hard to swallow...

Tianyuan Semiconductor closed down 14.93%, Meet Noodles down 14.77%, both drops were already quite restrained.....

Mechanism B issuance is no longer a panacea for mindless IPO applications. The main issue is still the high valuation. Brother Er Gou mentioned in the previous subscription strategy that these two companies have no valuation advantage. To put it bluntly, they just want to use the Mechanism B issuance model to cut leeks, and their behavior is too ugly....

Brother Er Gou wasn't very optimistic about these two new stocks, so he just touched them with cash, but surprisingly got 1 lot of Tianyuan Semiconductor. He didn't sell this afternoon, but will definitely sell tomorrow no matter what. Fortunately, he didn't get Meet Noodles, otherwise it would be two big bowls of noodles...

1. Basic Information

$BAO PHARMA-B(02659.HK), established in Shanghai in 2019, is a company focused on recombinant protein drugs and antibody drug technologies. The company has built a production base that complies with cGMP standards, with multiple bulk production lines covering mammalian cell expression systems and E. coli/yeast expression systems, as well as finished product lines for water injections, lyophilized powder injections, and disposable pre-filled syringes.

The company's strategy focuses on four major areas: large-volume subcutaneous drug delivery, antibody-mediated autoimmune diseases, assisted reproduction, and recombinant biopharmaceuticals.

The company has 12 self-developed products in the pipeline, including three core products:

KJ017: The most advanced recombinant human hyaluronidase in clinical development in China, having completed Phase III clinical trials.

KJ103: The world's first low-immunogenicity IgG degrading enzyme to enter the registration clinical stage.

SJ02: China's first approved long-acting FSH-CTP product, which received NDA approval from the National Medical Products Administration in August 22025.

2. IPO Information

Company Name & Code: Baoji Pharma-B (02659.HK)

Offer Price: 26.38KD

Minimum Subscription: 2664.60HKD (1 lot = 100 shares)

Subscription Period: Dec 02 - Dec 05, closing this Friday

Allotment Announcement: Dec 09

Listing: Dec 10

Shares Offered: 37.9117 million shares, accounting for 11.63% of total shares

Allocation Mechanism: Mechanism B

Market Cap: 8.599 billion HKD

Greenshoe: None

Cornerstone Investors: 3 cornerstone investors subscribed for 20.06%, average lineup

Sponsors: CITIC, Haitong.

3. Fundamentals

The company is currently not profitable, with financial data showing continuous losses.

In 2023, 2024, and the first half of 2025, the company's operating income was 6.93 million yuan, 6.16 million yuan, and 41.99 million yuan respectively, with net losses of 160 million yuan, 364 million yuan, and 183 million yuan in the same periods. The cumulative loss over two and a half years exceeded 700 million yuan.

The significant revenue growth in the first half of 2025 mainly came from licensing income of 40 million yuan.

4. Subscription Strategy

1. There's not much to say about the company's fundamentals. It's a B-share innovative drug company with good concepts. It's worth mentioning that the 18A innovative drugs listed this year had very strong first-day performances...

2. No greenshoe, but has cornerstone investors subscribing for 20%, that's it.

3. Mechanism B issuance, can't just mindlessly go all in. Combined A and B shares total 38,000 lots, not a small amount, but the heat is high. Margin financing has already reached 1,500 times, and with the return of Zhuoyue Ruixin's funds today, it will likely exceed 2,000 times. The winning rate won't be too high either.

4. In terms of valuation, the company's last round of financing was the C+ round in December 2024, with a post-investment valuation of 4.871 billion yuan (5.310 billion HKD at the latest exchange rate). The company's current issuance market cap is about 8.6 billion HKD, a premium of about 60% over the C+ round, meaning it's up about 60% in just one year, which is still acceptable...

5. Brother Er Gou went all in with margin on all three accounts...

Subscription Rating: 8 points (9-10 points go all in with margin, 7-8 points can use some margin, 6 points try a small amount, 5 points forget it)

Of course, this is just Brother Er Gou's personal strategy and does not constitute any investment advice....

Follow Brother Er Gou for a winning streak in HK IPO applications～～～

$ABLE DIGITAL(02687.HK) 

Disclaimer:

1. This article represents only one opinion and does not constitute any investment advice or recommendation. The stock market is unpredictable and volatile, with ups and downs. Caution is advised.

2. When making any investment decisions or transactions, please act within your means, handle it calmly based on your financial situation, or consult professional investment institutions.

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