J.P. Morgan Cashed in USD148 Million From Sale of CanSino Biologics Stock

XU WEI

(Yicai Global) May 28 — J.P. Morgan Chase cashed in nearly HKD1.2 billion (USD148 million) after selling holdings in CanSino Biologics, a vaccine researcher with no marketable products that is attempting to develop an inoculation for Covid-19, last week.

The New York-based investment sold 4.9 million shares at HKD253.30 (USD30.4X) apiece on the secondary market, the Hong Kong Stock Exchange said yesterday. J.P. Morgan still holds about 4.5 million shares, but has reduced its stake to 3.39 percent from 7.08 percent.

J.P. Morgan topped up its holdings of CanSino stock on May 19, paying an average price of HKD129.90. On May 21, the shares hit an all-time high of HKD285.80 but began to tumble as the investment bank start selling off its stock, with the share price eventually closing down 13 percent. CanSino stock [HKG:6185] was down another 8.05 percent at HKD160 when the market closed for lunch today.

Some have speculated that the diving share price was related to CanSino’s Covid-19 ongoing vaccine development at Oxford University, where, according to the World Health Organization, it conducted trials using non-replicating viral vectors.

The university announced disappointing results on May 21 for animal tests of the vaccine, which failed to prevent rhesus monkeys from becoming infected with the coronavirus and sparked concern about its efficacy in humans. Morgan Stanley still raised its target price for the stock to HKD258 from HKD102 on May 25 and maintained its overweight rating.

CanSino set up shop in 2009 and mostly researchers human vaccines for pneumonia, tuberculosis, Ebola and other diseases, though it is yet to commercialize a single product. It was the first company of its type to list in Hong Kong in March 2019, after racking up a CNY139 million (USD19.4 million) loss in 2018 — it is yet to turn a profit.

The firm is still hopeful to raise more cash and is soon to feature on the Shanghai Star Market for innovative sci-tech companies, having announced approval from the board’s listing committee on April 30.

Editor: James Boynton

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