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Investors Line Up for Dry Skin Specialist’s Share Sale

By Zhao Runhua / Oct 24, 2019 02:42 PM / Business & Tech

Photo: VCG

Photo: VCG

Investors hoping to cash in on China’s beauty fixation will soon have a new choice to bet on, as shares went on sale Thursday for Bloomage Biotech, a dry skin specialist preparing to list on the country’s new high-tech board.

Subscriptions to the company’s IPO will cost 47.79 yuan ($6.77) per share. One of Bloomage’s biggest assets is its strong profitability, which is much higher than many others listed on the Nasdaq-style high-tech board launched in Shanghai earlier this year.

Last year the company raked in 424 million yuan in profits on revenue of 1.3 billion yuan, according to its prospectus. Gross profit margin last year for its main business selling hyaluronic acid —a widely used material for skin hydration, knee osteoarthritis and dry eyes — came in at an eye-popping figure of over 70%. That figure is higher than many other companies on the high-tech board, though it’s relatively common in the pharmaceutical industry where margins of more than 80% aren’t unheard of.

Details from the prospectus offer a window into China’s fast-growing beauty and elder care industries, which have been criticized in the past for lack of transparency. The listing has also raised investor interest in stocks related to hyaluronic acid.

Shares of Lushang Health Industry Development, a Shanghai-listed health care company with several skin care affiliates, have risen over 80% since Bloomage’s IPO was proved by regulators a month ago.

Related: Plastic Surgery App Wants to Show Its Face on the Nasdaq

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