As the traditional Chinese New Year is approaching, the Chinese Communist government has recently issued a “new policy on returning Home“, requiring people returning home to take at least three nucleic acid tests for Chinese Communist Pneumonia (COVID-19). According to the mainland media, this move has ignited hundreds of billions of dollars of business opportunities. Because of the Epidemic, Chinese businesses dealing in nucleic acid testing equipment, reagents and testing services have reaped huge profits, with some manufacturers seeing their net profits soar 70 times last year.
The Communist Party’s National health Commission last Wednesday (20) issued a so-called “New Return to Home” policy that requires all people returning to their hometowns for New Year’s Eve to have a negative nucleic acid test within seven days, and to have another nucleic acid test on the seventh day and another on the 14th day after returning to their hometowns. This policy will be implemented from Jan. 28 to March 8.
According to Anhui securities company “Hua An Securities”, the overall demand for nucleic acid testing is about 600 million times, based on the number of people returning to their hometowns in rural areas alone, and 1.2 billion times if the number of people returning to their hometowns in urban areas is added. The total scale of nucleic acid testing products could be as high as 15 to 20 billion yuan, and the cost of nucleic acid testing services could be as high as 60 to 120 billion yuan.
The mainland media NetEase reported that the price of nucleic acid testing is not uniform across cities in mainland China, ranging from 75 yuan, 120 yuan to 180 yuan for a single test. And according to Wang Xiuchun, deputy director of the Department of Transport Services at the Ministry of Transport, 1.7 billion passengers are expected to be sent during the Spring Festival in 2021. If the cost of one nucleic acid test is calculated at 120 yuan, the total cost of nucleic acid testing for Chinese people could be as high as 204 billion yuan, not including the second and third tests after the anti-homeland. The report exclaims, “A 100 billion dollar market is just around the corner!”
Statistics published by the land media show that since this year, the share prices of leading testing companies such as China Goldfield Medical, Huada Genetics, Kepo Bio and Dean Diagnostics have risen by as much as 31.46%, 38.46%, 23.63% and 45.13% respectively; compared to the same period last year, net profit growth reached 293%, 1066%, 167% and 165%.
Among the 24 A-share nucleic acid testing concept stocks, three companies operating nucleic acid testing equipment, testing services and production of nucleic acid reagents – Daan Gene, ShuoShi Biological and Oriental Biological – have net profit growth of more than 1000% in the first three quarters of 2020; Sheng Xiang, which integrates diagnostic reagents, instruments and third-party medical testing services Biotech, whose annual net profit in 2020 increased by 2.48 billion yuan to 2.73 billion yuan, or 6,593% to 7,257%.
The report also mentions that China’s genome sequencing company “Huada Genetics” has not performed well from 2015 to 2019, with net profit attributable to the mother company of $262 million, $333 million, $398 million, $387 million and $276 million, respectively. The performance during these five years has been largely stagnant.
However, after the outbreak of the CCP pneumonia epidemic, UWM reported a net profit of $1.654 billion in the first half of 2020 alone, equivalent to earning a full five years’ worth of money in half a year. The company posted a net profit of 2.705 billion yuan in the first three quarters of 2020, an increase of 901.68 percent year-on-year.
The traditional New Year is highly valued by Chinese people, and going home for the New Year has become an almost indispensable part of their lives. After the official release of the “New Policy on Returning Home” by the Chinese Communist Party, countless people working abroad have already embarked on the journey to find testing facilities to undergo nucleic acid testing.
On internet forums in mainland China, many netizens are busy asking each other where they can get a nucleic acid test. Some people opened Alipay to book nucleic acid testing, only to find that several nucleic acid testing facilities were full and appointments were already scheduled until the end of February.
Long lines of people were common at the entrance of medical institutions in major cities where nucleic acid testing is available, with some people even going to the hospital entrance at 2 or 3 am to wait in line.
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