2269.HK

The latest: WuXi XDC Cayman Inc. (2268.HK), a unit of WuXi Biologics (Cayman) Inc. (2269.HK), formally launched its initial public offering on Tuesday, with plans to raise up to HK$3.68 billion ($471 million) by selling 178 million shares for HK$19.90 to HK$20.60 apiece.

Looking up: The IPO will bring in seven cornerstone investors, including such big names as Qatar Investment Authority, HongShan Fund and Lake Bleu Funds. Participation of such well-known investors could help to attract others to buy the IPO shares.

Take Note: The company’s relatively high subscription fee of up HK$10,404 for the minimum 500-share lot could deter some smaller investors.

Digging Deeper: Established in December 2020, WuXi XDC mainly supplies contract research, development and manufacturing (CRDMO) services for antibody-drug conjugate (ADC) and other biocoupling drugs. It is a subsidiary of WuXi Biologics, a leading global biomolecule drug services company. According to research cited in its prospectus, WuXi XDC was the world’s second largest CRDMO engaged in ADC and other bioconjugate drugs last year, with 9.8% of the global market. In the first half of this year, its revenue totaled 993 million yuan ($136 million), up 202%, while its profit was 177 million yuan, up 80%.

Market Reaction: Shares of WuXi Biologics, the parent of WuXi XDC, fell on Tuesday, closing down 1.8% to HK$49.80 at the midday break. It now trades at the lower end of its 52-week range.

Translation by A. Au

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