Bio firm HLB lead­ing Kosdaq’s bullish run

The Korea Times - - FINANCE - By Jhoo Dong-chan [email protected]­re­atimes.co.kr

The mas­sive surge in share price of biotech com­pany Hyundai Life Boat (HLB) is lead­ing the sec­ondary Kosdaq’s bull mar­ket. Now, in­vestors are fo­cused on whether the firm’s stock will con­tinue the cur­rent up­trend un­til the end of the year.

Ac­cord­ing to the Korea Ex­change (KRX), the share price of HLB has jumped about 300 per­cent over the past month. The bio firm’s mar­ket cap­i­tal­iza­tion sur­passed Cell­trion Health­care’s fig­ure dur­ing in­tra­day trad­ing, Tues­day, top­ping Kosdaq-listed firms.

The mar­ket value of Cell­trion Health­care had led the Kosdaq for about a year and nine months be­fore then.

The share price of HLB closed at 180,800 won ($154), Tues­day, up 7.75 per­cent from the pre­vi­ous ses­sion. It hit its new 52-week high dur­ing the Tues­day ses­sion af­ter jump­ing 29.98 per­cent the pre­vi­ous day.

The biotech firm has be­come the sec­ond most valu­able stock on the Kosdaq with a mar­ket cap­i­tal­iza­tion of 7.09 tril­lion won.

The fi­nan­cial au­thor­i­ties sus­pended trad­ing of HLB’s stock Wed­nes­day to off­set a sud­den 40 per­cent jump dur­ing the Mon­day and Tues­day ses­sions.

In­vestors be­lieve the firm’s share price still has room to move fur­ther up.

“HLB is sched­uled to have a pre-new drug ap­pli­ca­tion meet­ing for its an­ti­cancer drug Rivo­ceranib

with the U.S. Food and Drug Ad­min­is­tra­tion on Fri­day,” HLB an­nounced ear­lier this week.

Fol­low­ing HLB’s ad­vance, the share prices of other bio firms have also en­joyed an up­trend this month.

Share prices of Sil­laJen and Sam­sung Bi­o­Log­ics were up 82.94 per­cent and 15.33 per­cent, re­spec­tively, this month. Cell­trion Health­care’s share price has also climbed 13.26 per­cent.

The cur­rent up­trend of the Kosdaq-listed bio firms is in a stark con­trast to their slug­gish stock prices in Au­gust.

On Aug. 5, the KRX is­sued a five-minute “side­car” on the Kosdaq for the first time since 2016 due to In­vestors’ mas­sive sell-off. A se­ries of clin­i­cal fail­ures re­ported by ma­jor Kosdaq-listed bio firms was the rea­son be­hind Kosdaq’s crash on the day.

Ex­perts called for a cau­tious ap­proach to the Kosdaq-listed bio firms.

“The cur­rent bull mar­ket looks a bit ground­less,” said Mi­rae As­set Dae­woo an­a­lyst Kim Tae-hee. “A num­ber of in­vestors bor­rowed money to in­vest in HLB and other bio shares. This could be a risk fac­tor.”

Other an­a­lysts ex­pressed reser­va­tions about HLB shares.

“The cur­rent up­trend is clearly ab­nor­mal. It’s true for­eign in­vestors mas­sively bought HLB shares this week, but in­sti­tu­tional in­vestors are still tak­ing a wait-and-see ap­proach. They could short it if it fails to get ap­proval from the U.S. au­thor­i­ties,” an­other an­a­lyst said on con­di­tion of anonymity.

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