China Targets 15-Minute TCM Service by 2030; Zhongji Innolight, BOE A, Hailiang Plan Buybacks and Holdings
China's 11 government departments jointly issued an action plan to strengthen grassroots traditional Chinese medicine services, aiming to establish a 15-minute TCM service circle by 2030. Separately, Zhongji Innolight's chairman proposed a share buyback of RMB 4 billion to RMB 8 billion. BOE A's controlling shareholder plans to increase holdings by RMB 500 million to RMB 1 billion, and Hailiang's controlling shareholder by RMB 600 million to RMB 1 billion. Since July, the TCM sector index gained 10.22% while the Shanghai Composite fell 6.87%. Stocks such as Longsheng surged 101.27%, Zhenbaodao rose 57.08%, and others gained over 20%. Zhongji Innolight fell 28.5% since July, BOE A dropped 35.71%, and Hailiang declined 26.09%.
11 government departments jointly issued the Medical and Health Strengthening Project Traditional Chinese Medicine Action Plan, aimed at strengthening grassroots TCM service supply. The plan proposes that by 2030, a grassroots TCM service network integrating prevention, treatment, and rehabilitation will be fully established, striving to enable residents to reach the nearest medical service point for TCM services within 15 minutes.
Since July, nine TCM stocks have received net margin buying. Zhenbaodao, Yiling Pharmaceutical, and Guangyuyuan received net buying of RMB 25.0981 million, RMB 16.548 million, and RMB 14.1011 million, respectively. The TCM sector index has risen 10.22% since July, while the Shanghai Composite Index has fallen 6.87% over the same period. Among individual stocks, Longsheng rose 101.27% since July, Zhenbaodao rose 57.08%, and Shanghai Kaibao, Hansen Pharmaceutical, and Pianzaihuang all rose more than 20%.
On the evening of July 28, Zhongji Innolight announced that its chairman proposed to repurchase the company's shares using its own or self-raised funds for equity incentives or employee stock ownership plans. The total repurchase funds are not less than RMB 4 billion and not more than RMB 8 billion. This is the first time the company has issued a related announcement of a repurchase plan since 2023. Zhongji Innolight's share price has fallen 28.5% since July, and fell 15.69% on July 28, with a total market capitalization of RMB 1.01 trillion.
On the same evening, BOE A announced that its controlling shareholder plans to increase its holdings in the company by RMB 500 million to RMB 1 billion. Hailiang announced that its controlling shareholder plans to increase holdings by RMB 600 million to RMB 1 billion. BOE A has fallen 35.71% since July, and Hailiang has fallen 26.09% since July.
There are 68 stocks in the A-share TCM sector, and 19 have released announcements related to their half-year performance. Based on net profit or the lower limit of the performance forecast, two stocks turned from loss to profit, and nine stocks achieved year-on-year growth in net profit attributable to shareholders. The latest price-to-earnings ratio data show that the TCM sector index has a PE of 23.49 times, and 19 TCM stocks have a PE below 20 times. Jilin Aodong, Baiyunshan, and Jianmin Group have PE ratios of 7.76 times, 11.98 times, and 12.46 times, respectively.
Why this event matters
The event has a measured impact on 1 industry. The strongest current signal is positive for Traditional Chinese Medicine, with intensity 70/100 and 85% confidence over a long term horizon.
Impact figures are analytical estimates that combine direction, intensity, confidence and event importance. They are not investment advice.