Clean up the problems left over by history and clarify the future main business like listed companies in some domestic monopoly industries, Yueyang Xingchang also made some long-term investments with little relevance to the main business after making money in the oil industry. In the first half of this year, the company has a total of 7 holding companies and 2 shareholding companies, but most of the subsidiaries are in a state of loss. China Petroleum & Chemical Corp document No. 334 in the first half of this year stipulates that relevant enterprises must withdraw from some areas that are not related to their main business, but the withdrawal industry catalogue does not include Yueyang Xingchang's Kangwei Pharmaceutical Industry. The company's board of directors discussed and passed a motion to implement China Petroleum & Chemical Corp's decision, and the board of directors passed the disposal of the assets of five holding subsidiaries, including Changsha Yihai Real Estate, which are obviously in the company's nine holding and shareholding subsidiaries. all but petrochemical assets and pharmaceutical assets will be disposed of. It shows that the problems left over by the company's history are basically cleaned up, and the company will concentrate on developing its main business and financial resources in the future.

Stomach disease vaccine is only waiting for production approval, and the market potential is huge. On August 5 this year, the Science and Technology News disclosed that the test results of the company's stomach disease vaccine were completed on August 4, and the results were very good. The company's semi-annual report also announced the process of drug development. At present, the Ministry of Health and the World Health Organization attach great importance to it, and it is expected that the new drug certificate can be obtained by the end of this year, production can be organized in 2007, and benefits will be produced in 2008. The market prospect of gastropathy vaccine has been described in detail in the previous in-depth report, so I will not repeat it here.

With China Petroleum & Chemical Corp's entry into the share reform, the company's share reform will also be put on the agenda. The vaccine industry will become the company's most important main business. China Petroleum & Chemical Corp announced on the 21st of this month that he will enter the share reform process, which means that its privatization work has been postponed. The restructuring or privatization of Yueyang Xingchang is different from that of petrochemical companies. China Petroleum & Chemical Corp Group is only its second largest shareholder, the first and third largest shareholders and circulation shareholders will play a very important role in its restructuring and integration decisions. It is an inevitable trend that Yueyang Xingchang's current main petrochemical assets are gradually bought back by China Petroleum & Chemical Corp Group, but because of this, the vaccine, as the only possible main business of the company in the next step, will not be sold easily. At present, other brokerage analysts doubt that the vaccine will be sold. We think this is highly unlikely. It is expected that the company will begin the preparatory work for production while applying for the new drug certificate, and will enter the profit stage in 2008.

Risk hint: the inconsistent understanding of the company's management may affect the progress of drug production and marketing.