On July 21st, according to Caixin Global, the stock price of SinoMab BioScience Limited (06969.HK) slightly increased in early trading today, rising by 3.88% to HKD 21.4 at the time of publication.
The market performance of Simary International's stock price.
The stock price of Simer International rose in early trading, attributed to its fully-owned subsidiary, Weipulai Technology Co., Ltd. in Shenzhen, receiving a tobacco monopoly production enterprise license issued by the Tobacco Monopoly Bureau. The license is valid from July 11, 2022, to July 31, 2023.
In accordance with the regulations of the "Electronic Cigarette Management Measures" and related Q&As released by the China National Tobacco Corporation on March 11, 2022, individuals and companies engaged in the production, wholesale, and retail of electronic cigarettes within China's borders will need to obtain the relevant tobacco monopoly license. Additionally, a transitional period will be implemented from May 1, 2022, to September 30, 2022.
The stock price of Smoore International rose slightly, leading to an increase in related electronic cigarette concept stocks, including Huabao International (00336.HK), China Botton (03318.HK), and BYD Electronic (00285.HK), which all rose by 4.61%, 1.12%, and 0.94%, respectively.
Concept stocks of e-cigarettes.
In addition, Sumner International recently released its performance forecast for the first half of 2022, expecting an adjusted net profit of RMB 1.375 billion to 1.606 billion, a year-on-year decrease of 46.01% to 53.80%. Among them, Q1 achieved an adjusted net profit of RMB 553 million, a year-on-year decrease of 54.91%, and it is estimated that Q2 will achieve an adjusted net profit of RMB 821 million to 1.053 billion, a year-on-year decrease of 30.76% to 53.02%, representing an increase of 48.39% to 90.26% from the previous quarter.
Electronic cigarette regulation transition period ends, agency predicts continuous industry growth.
According to Dongxing Securities, during the first quarter, Smoore International's production and operation were affected by the Shenzhen epidemic, but have since returned to normal in Q2. However, due to changes in regulatory policies, the domestic electronic cigarette industry needs to adjust and adapt in terms of products and channels, and during this period, manufacturing orders may be affected. On the other hand, the company's overseas market revenue has maintained steady growth, considering the continuous increase in market share of its largest customer, British American Tobacco, and the good market development of the company's own brand open-system atomization device (APV) since the second half of 2021.
Dong Xing pointed out that the domestic regulatory transition period ended on September 30 last year, during which the electronic cigarette industry was still in the adjustment phase, and company sales may continue to be under pressure. In the future, attention still needs to be paid to consumers' acceptance of tobacco-flavored electronic cigarettes under the new national standard, as well as the regulatory framework for the industry's overall management policy. Based on the harm reduction advantage of electronic cigarettes over traditional cigarettes, the industry's long-term growth prospects remain promising.
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