Brokers' Take

AsiaPharm Group Ltd, Dec 10 close : 54 cents

11 December 2004
The Business Times

Phillip Securities Research, Dec 10

SANTA Claus' early gift: AsiaPharm has made an encouraging announcement amid a gloomy market. One of its key drugs Elcatonin for injection' has recently been included into the National Health Insurance List of China.

In addition, Lutingnuo, which has already been included in the list in H1 2004 and is one of the group's fastest growing drugs, has been classified as a National Leading New Product' by four state departments in China.

The sales of Elcatonin for injection' after its inclusion into the National Health Insurance List' should increase, and we expect that other major drugs would also have good growth in sales. Besides, AsiaPharm is expanding its sales force.

We believe in its growth momentum in FY05, and we maintain our 'buy' call with a fair value at S$0.75.

AsiaPharm is expanding its production line.

As the current production line for injection drugs is running at a high capacity, a new production line is being built to drive the growth of sales for injection drugs. The new production line is expected to be in operation in mid 2005.

AsiaPharm will possibly achieve greater economies of scale for the production of injection drugs, and gain a better position to compete in the market. BUY

Compiled by JOYCE KOH