Beijing Shuanglu Pharmaceutical Co Ltd will be listed on the small and medium-sized enterprise (SME) board of the Shenzhen Stock Exchange this coming Thursday.

The company issued 19 million A shares to secondary market investors, at a fixed price of 12 yuan (US$1.45) per share, on August 25, according to China Daily Tuesday.

Through its initial public offering, the company had raised funds totalling 212 million yuan (US$25.6 million) by August 31, the company said in a circular published yesterday.

"As a major player in the domestic bio-pharmaceutical industry, Shuanglu has a broad development opportunity in the future, with a potentially huge market," a research analyst from Guojin Investment said.

The current annual per capita drug consumption in China is only about US$10, compared to US$300 in the world's major developed countries, said the analyst.

China's pharmaceutical enterprises have made great progress in recent years and are capable of competing with their overseas rivals.

During the past three years, Shuanglu has achieved rapid growth.

The company's prospectus states its turnover increased 49.85 per cent annually on average over the past three years, with annual profits rising by 26.5 per cent.

From January to June this year, Shuanglu's major business income totalled 43.87 million yuan (US$5.3 million), 42.11 per cent up over the same period last year.

Shuanglu attributed the fast growth to its relatively strong research and development capability, a sound marketing network and new products which meet market demands.

Proceeds raised by the IPO will be used to upgrade its technology and expand production capacity for gene engineering products and chemical medicines, reports the company.

But, industry analysts warn that the country's continuous lowering of medicine prices might impact Shuanglu's sales income and profit growth in the next few years.

Further concerns among analysts about Shuanglu's share performance have been triggered by the gloomy domestic stock market.

In August, market prices of some newly-listed shares like Zhejiang Supor and Mizuda fell below their floatation prices on their first day of trading.

Source: China Daily