Event: on February 09, 2021, the company announced that it would issue no more than 244 million shares to Zhongheng Group, Zhongheng Tongde and Guangzhou Investment Guohong at the issue price of 4.50 yuan per share, raising 1.084 billion yuan.

Raise 1.084 billion yuan from non-public offerings such as Zhongheng Group to repay loans and replenish working capital:

The company issued 244 million non-public shares to Zhongheng Group, Zhongheng Tongde and Guangzhou Investment Guohong at the issue price of 4.50 yuan per share, raising a total of 1.084 billion yuan. After deducting the issuance expenses, 700 million yuan will be used to repay the loans, and the rest will be used to replenish the working capital. We believe that this private offering will help the company to optimize its balance sheet structure and improve its profitability, and lay a good foundation for the company to focus on the development of oncology and ophthalmology.

To strengthen the layout of ophthalmic drugs, atropine eye drops have been registered and approved by medical institutions:

The company continues to strengthen the distribution of ophthalmic drugs such as myopia, xerophthalmia and retinal diseases. Among them, in the field of myopia, atropine sulfate eye drops jointly developed by Changsha Aier and Hunan Mei'ou have received the registration approval of preparations from medical institutions. In the field of retinal diseases, through signing a "strategic cooperation agreement" with Youzhiyou Biology, the company has won the priority to sell its new ophthalmology drug Y400 wet macular degeneration (nAMD) bispecific antibody drugs in China.

Investment suggestion: the net profit from 2020 to 2022 is expected to be-300 million yuan, 78 million yuan and 102 million yuan respectively, an increase of-93.5%, 126.0% and 30.7% respectively over the same period last year.

Risk hints: the risk of new drug research and development falling short of expectations, the risk of product sales falling short of expectations, etc.