Rapid Drop
The stock price of Celltrion, which has the largest market cap in the KOSDAQ market, has plummeted by more than 15% in a month since it was classified into the group of enterprises subject to cross-shareholding and debt guarantee restrictions. Experts point out that the recent approval of its new drug and the business performances of its subsidiaries, as well as the designation, are the reasons.
On May 3, its stock price closed at 99,600 won per share, down 15.5% from a month ago. The decrement amounts to 21.5% when compared to this year’s high recorded on February 11. “Since Celltrion has been classified as a conglomerate on April 3 this year, it can no longer be engaged in internal transactions and has to sell its products in the United States and Europe via distribution channels other than its subsidiary Celltrion Healthcare,” said Meritz Securities research analyst Kim Hyeon-wook, continuing, “This can impose a significant burden on the company.”
In the meantime, an increasing number of investors are taking profits these days by selling Celltrion shares after the sale of its biosimilar Remsima was allowed by the Food and Drug Administration (FDA) of the United States. Besides, Celltrion Healthcare came up with business records falling short of expectations as of late. “If Celltrion Healthcare had done its business right in Europe, the sales revenue should have increased and the inventory assets should have decreased,” the research analyst explained, adding, “However, the latter rose to 1.4 trillion won or so.”
Last month, Harim Holdings and Kakao were classified into the same group of conglomerates as Celltrion. However, both of them are currently faring well in the South Korean stock market. For instance, the stock price of Harim Holdings gained 11.3% between April 4 and May 3 to reach 5,010 won per share. That of Kakao increased by 0.5% during the same period, closing at 99,800 won per share on May 3.