A detractor among individual stocks was Sinopharm (HKSE:01099, Financial), China's largest pharmaceutical distributor and one of the few distributors with a meaningful nationwide presence. The company saw weak results in the frst half of 2020 owing to negative economic impact from the COVID-19 outbreak. Hospital visitation during the pandemic fell, which reduced pharmaceutical distribution needs. At the same time, the company saw increased operational expenses associated with the prevention and containment of the virus situation. Sinopharm trades at attractive valuations and commands a still large and dominant presence in China's healthcare distribution industry. We continue to monitor this position for updates and operational improvements.
From the Matthews China Fund (Trades, Portfolio)'s fourth-quarter 2020 commentary.
