Sinopharm (HKSE:01099, Financial) is China's largest pharmaceutical distributor. It is one of China's few distributors with a meaningful nationwide presence. Sinopharm saw weak results in the first 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 health care distribution industry. We continue to monitor this position for updates and operational improvements.
From the Matthews China Fund (Trades, Portfolio) second-quarter 2020 commentary.
