Equities have greeted 2018 with a bang, but none more so than Korean pharmaceutical maker Celltrion Inc., which has piled on about 9 trillion won ($8.4 billion) of market value in just seven days.
The surge has seen Incheon-based Celltrion which makes most of its money manufacturing copies of drugs whose patents have expired streak past Hyundai Motor Co., South Korea’s largest automaker, to become the third-biggest company by value on the country’s stock exchange. Its 37 trillion won market cap puts it behind smartphone behemoth Samsung Electronics Co. at No. 1 and chip giant SK Hynix Inc. in second place.
In fact, SK Hynix’s 53 trillion-won market cap is now about equal to the combined value of Celltrion and its two subsidiaries Celltrion Healthcare Co. and Celltrion Pharm Inc.
There’s a couple of reasons behind the leap. Celltrion launched a new drug for treating blood cancer in Europe last year, which analysts say got a good reception, bolstering the company’s prospects. Speculation that Korea plans to boost investment in the small-cap Kosdaq market where Celltrion is listed has also fueled gains. The shares have rallied every day but one in 2018, after more than doubling last year.
“This stock has long been a target for short sellers who had doubts over the company’s business,” said Han Byung-hwa, an analyst with Eugene Investment & Securities in Seoul, said by phone. “But shorts haven’t been able to withstand the buying.”