# Hualan Biological EngineeringInc (002007.SHE)

Canonical: https://gigainvestors.com/s/002007.SHE

Analysis as of: 2026-10-16T07:38:39.110Z. Financial observations: FY2001–FY2025.

Listing currency: CNY. Reporting currency: CNY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: CNY 12.97 per share; close as of 2026-10-15.

Estimated value: low CNY 7.43 per share, central CNY 8.23 per share, high CNY 9.30 per share. Buy at or below the central value CNY 8.23 per share. Valuation as of 2026-10-16T07:38:39.110Z; scenarios are not confidence intervals.

Expected annual return: 7.0% at the stated quote. About 7.0% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; CN 10-year bond 1.7% + 4 points).

## Checklist

### understandable: pass

- 2 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 2

- Years with a net loss: 0

- Operating margin variation: 0.16×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.43×

- FY2017: 0.39×

- FY2018: 0.43×

- FY2019: 0.44×

- FY2020: 0.43×

- FY2021: 0.38×

- FY2022: 0.32×

- FY2023: 0.39×

- FY2024: 0.32×

- FY2025: 0.25×

### moat: fail

- Recent gross margin fell 8.1pp below the typical margin (limit 4pp)

- ROIC, median of available years: 24.8%

- ROIC, second-lowest year: 12.5%

- Typical minus recent gross margin: 8.1 pp

- Typical gross margin (annual median): 63.0%

- Recent gross margin (lower of latest and 3-year median): 54.9%

- Years with nonpositive capital: 0

- Capital spending / revenue: 8.0%

- ROIC including acquisitions, ten-year median: 20.9%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 29.4%

- FY2017: 25.1%

- FY2018: 39.5%

- FY2019: 43.6%

- FY2020: 47.3%

- FY2021: 24.5%

- FY2022: 15.5%

- FY2023: 19.9%

- FY2024: 12.5%

- FY2025: 12.4%

### economics: fail

- incremental invested capital return below threshold

- working capital as a share of revenue rose more than 10pp and ends positive

- Owner earnings / net income, 5-yr: 0.88×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CNY 5.2B

- Net income, five-year total: CNY 5.9B

- Return on incremental invested capital: 7.7%

- Working capital / revenue, annual change: 2.0 pp

- Working capital / revenue, change between three-year averages: 10.4 pp

- Working capital / revenue, final three-year average: 85.4%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.53×

- FY2022: 0.93×

- FY2023: 0.93×

- FY2024: 1.00×

- FY2025: 1.08×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 29.4% vs 12.5%

- Per-share earnings: 0.43 to 0.59 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.1%

- Ordinary dilution, 5-year annual growth: 0.0%

- Market cap gain: CNY -37B

- Cumulative retained earnings: CNY 4.9B

- Diluted shares, 10-year annual growth: 0.1%

- Diluted shares, 5-year annual growth: 0.0%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 4.1%

- Per-share value change: CNY 0.16

- Per-share value, starting three-year median: CNY 0.43

- Per-share value, ending three-year median: CNY 0.59

- Average buyback yield: 0.3%

- Buyback history: 1 years

- Debt-funded buybacks: No

- Acquisition spending: CNY 150M

- Cumulative net income, 10 years: CNY 12B

- ROIC, first three-year median: 29.4%

- ROIC, last three-year median: 12.5%

Chart: Earnings per share; fiscal year observations.

- FY2016: CNY 0.43

- FY2017: CNY 0.45

- FY2018: CNY 0.63

- FY2019: CNY 0.70

- FY2020: CNY 0.88

- FY2021: CNY 0.71

- FY2022: CNY 0.59

- FY2023: CNY 0.81

- FY2024: CNY 0.59

- FY2025: CNY 0.51

### accounting: pass

- Sloan accruals: -1.3%

- Receivables to sales index (DSRI): 0.96×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.21×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.03×

Chart: Sloan accruals; fiscal year observations.

- FY2016: 9.7%

- FY2017: 12.3%

- FY2018: -2.4%

- FY2019: -1.0%

- FY2020: 2.9%

- FY2021: -1.2%

- FY2022: 0.8%

- FY2023: 0.8%

- FY2024: 0.2%

- FY2025: -1.3%

## Holders

## Price story

Down 56% since Oct 2021 · sales +4.5%

Story as of 2026-10-16T10:00:10.095Z; price observation 2026-10-15.

Price needs cash profits to grow 7.7% a year for ten years

### Sales · FY2024–2025

sales +4.5%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: CNY 1.9B 

- FY2017: CNY 2.4B 

- FY2018: CNY 3.2B 

- FY2019: CNY 3.7B 

- FY2020: CNY 5.0B 

- FY2021: CNY 4.4B 

- FY2022: CNY 4.5B 

- FY2023: CNY 5.3B 

- FY2024: CNY 4.4B 

- FY2025: CNY 4.6B 

### Gross margin · FY2025

gross margin 54.9%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 60.0% 

- FY2017: 61.1% 

- FY2018: 65.0% 

- FY2019: 63.6% 

- FY2020: 72.0% 

- FY2021: 65.3% 

- FY2022: 62.4% 

- FY2023: 67.7% 

- FY2024: 59.6% 

- FY2025: 54.9% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in biotechnology; annual sales are CNY 4.6 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2025: revenue 4575883532; grossProfit 2512266912; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 002007.SHE: Hualan Biological Engineering Inc., together with its subsidiaries, engages in the research, development, production, and sale of biological products in China and internationally. The company offers blood products, including human serum albumin, human prothrombin complex concentrate, human coagulation factor VIII, human fibrinogen, and freeze-dried human fibrin glue for surgical use, as well as intravenous, human, rabies, hepatitis B, and tetanus immunoglobulin for various therapeutic applications. It also provides vaccine products, such as influenza virus split, H1N1 influenza A virus split, quadrivalent influenza virus split, group A and C meningococcal polysaccharide, group ACYW135 meningococcal polysaccharide, recombinant hepatitis B vaccine, freeze-dried human rabies, and adsorbed tetanus vaccines. In addition, the company develops monoclonal antibody drugs and biosimilars comprising rituximab injection which is in Phase III clinical trials for the treatment of CD20-positive diffuse large B-cell/follicular non-Hodgkin lymphoma and chronic lymphocytic leukemia; adalimumab injection which is in Phase III clinical trials for the treatment of various autoimmune diseases; denosumab injection which is in Phase III clinical trials for the treatment of patients with bone metastases; injectable trastuzumab which is in Phase III clinical trials for the treatment of HER2-positive metastatic/early-stage breast cancer and metastatic gastric cancer; and recombinant Exendin-4-FC fusion protein injection which is in Phase I/II clinical trials for the treatment of type 2 diabetes. Further, it is involved in the research and development of poultry farming; plasma collection; engineering technology research and experimental development; and inspection and testing services. The company was founded in 1992 and is headquartered in Xinxiang, China.

### Why customers stay

Margins ranged from 54.9% to 67.7% during 2023–25; it earns 24.8% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2023: grossProfit / revenue = 67.7%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2024: grossProfit / revenue = 59.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2025: grossProfit / revenue = 54.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); 10-year return on capital observations [[2016,0.29430145006660435],[2017,0.2505751154371065],[2018,0.3950362828774337],[2019,0.43616701128177504],[2020,0.4731728045751482],[2021,0.24454655901589897],[2022,0.15476806752076946],[2023,0.19859694945776646],[2024,0.1251847607358855],[2025,0.1242966747647136]]; median 0.24756083722650274. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2016: growth capex 77005319; upkeep 143656484; owner earnings 780312525. Growth capex / owner earnings = 0.09868522743499472.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2017: growth capex 0; upkeep 108535155; owner earnings 858750174. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2018: growth capex 43983108.80000001; upkeep 139279890; owner earnings 1139512940. Growth capex / owner earnings = 0.038598165282791794.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2019: growth capex 112053962; upkeep 160897014; owner earnings 1283449054. Growth capex / owner earnings = 0.08730690295089812.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2020: growth capex 439777682; upkeep 181663012; owner earnings 1613105264. Growth capex / owner earnings = 0.27262801245188917.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2021: growth capex 0; upkeep 811346639; owner earnings 683938239. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2022: growth capex 34470342.0004521; upkeep 359478423.9995479; owner earnings 999627508.9987508. Growth capex / owner earnings = 0.034483186677183746.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2023: growth capex 372240977.392079; upkeep 381170092.607921; owner earnings 1377339577.1892412. Growth capex / owner earnings = 0.2702608590916389.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2024: growth capex 0; upkeep 255790777; owner earnings 1090228633.005538. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); FY2025: growth capex 0; upkeep 197305264; owner earnings 1018048879.784694. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); Dividend observations: [[2016,232521920],[2017,397035072],[2018,275260158],[2019,390645470],[2020,561343608],[2021,564110114],[2022,364873345],[2023,563642246.3],[2024,467829671],[2025,1361482040.86]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 48.7% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 002007.SHE SharesStats.PercentInsiders = 48.693 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 7.7% yearly over ten years; actual growth was 5.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:38:39.110Z); Ten-year compound average after fade. Initial solved rate 0.09718463334828276. Price 12.97; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.32484404209900847 → FY2025 0.5575160423478787. Closing-price date 2026-10-15.

## Monthly share-price history (CNY per share)

- 2016-10: CNY 36.28 per share

- 2016-11: CNY 35.60 per share

- 2016-12: CNY 35.75 per share

- 2017-01: CNY 34.38 per share

- 2017-02: CNY 36.68 per share

- 2017-03: CNY 35.80 per share

- 2017-04: CNY 36.61 per share

- 2017-05: CNY 35.40 per share

- 2017-06: CNY 36.50 per share

- 2017-07: CNY 28.45 per share

- 2017-08: CNY 28.21 per share

- 2017-09: CNY 27.21 per share

- 2017-10: CNY 28.67 per share

- 2017-11: CNY 28.95 per share

- 2017-12: CNY 26.88 per share

- 2018-01: CNY 27.02 per share

- 2018-02: CNY 26.86 per share

- 2018-03: CNY 30.07 per share

- 2018-04: CNY 28.58 per share

- 2018-05: CNY 36.09 per share

- 2018-06: CNY 32.16 per share

- 2018-07: CNY 33.52 per share

- 2018-08: CNY 34.07 per share

- 2018-09: CNY 37.90 per share

- 2018-10: CNY 34.12 per share

- 2018-11: CNY 37.78 per share

- 2018-12: CNY 32.80 per share

- 2019-01: CNY 33.61 per share

- 2019-02: CNY 38.71 per share

- 2019-03: CNY 45.00 per share

- 2019-04: CNY 41.75 per share

- 2019-05: CNY 42.17 per share

- 2019-06: CNY 30.49 per share

- 2019-07: CNY 29.98 per share

- 2019-08: CNY 32.60 per share

- 2019-09: CNY 34.30 per share

- 2019-10: CNY 36.05 per share

- 2019-11: CNY 33.46 per share

- 2019-12: CNY 35.15 per share

- 2020-01: CNY 36.08 per share

- 2020-02: CNY 41.50 per share

- 2020-03: CNY 47.90 per share

- 2020-04: CNY 38.87 per share

- 2020-05: CNY 41.26 per share

- 2020-06: CNY 50.11 per share

- 2020-07: CNY 64.93 per share

- 2020-08: CNY 57.63 per share

- 2020-09: CNY 56.99 per share

- 2020-10: CNY 51.20 per share

- 2020-11: CNY 43.04 per share

- 2020-12: CNY 42.24 per share

- 2021-01: CNY 45.99 per share

- 2021-02: CNY 42.78 per share

- 2021-03: CNY 39.75 per share

- 2021-04: CNY 42.08 per share

- 2021-05: CNY 40.40 per share

- 2021-06: CNY 36.68 per share

- 2021-07: CNY 36.79 per share

- 2021-08: CNY 29.43 per share

- 2021-09: CNY 27.90 per share

- 2021-10: CNY 29.70 per share

- 2021-11: CNY 28.90 per share

- 2021-12: CNY 29.14 per share

- 2022-01: CNY 25.22 per share

- 2022-02: CNY 25.70 per share

- 2022-03: CNY 20.31 per share

- 2022-04: CNY 16.69 per share

- 2022-05: CNY 18.70 per share

- 2022-06: CNY 22.80 per share

- 2022-07: CNY 20.00 per share

- 2022-08: CNY 19.76 per share

- 2022-09: CNY 18.16 per share

- 2022-10: CNY 17.73 per share

- 2022-11: CNY 20.46 per share

- 2022-12: CNY 22.63 per share

- 2023-01: CNY 22.30 per share

- 2023-02: CNY 22.19 per share

- 2023-03: CNY 21.83 per share

- 2023-04: CNY 23.28 per share

- 2023-05: CNY 22.53 per share

- 2023-06: CNY 22.41 per share

- 2023-07: CNY 23.03 per share

- 2023-08: CNY 21.23 per share

- 2023-09: CNY 22.20 per share

- 2023-10: CNY 23.47 per share

- 2023-11: CNY 24.17 per share

- 2023-12: CNY 22.13 per share

- 2024-01: CNY 17.60 per share

- 2024-02: CNY 19.73 per share

- 2024-03: CNY 20.17 per share

- 2024-04: CNY 19.47 per share

- 2024-05: CNY 18.17 per share

- 2024-06: CNY 15.79 per share

- 2024-07: CNY 16.49 per share

- 2024-08: CNY 15.07 per share

- 2024-09: CNY 17.91 per share

- 2024-10: CNY 16.48 per share

- 2024-11: CNY 16.86 per share

- 2024-12: CNY 16.85 per share

- 2025-01: CNY 15.81 per share

- 2025-02: CNY 15.79 per share

- 2025-03: CNY 15.53 per share

- 2025-04: CNY 16.38 per share

- 2025-05: CNY 16.11 per share

- 2025-06: CNY 15.67 per share

- 2025-07: CNY 16.58 per share

- 2025-08: CNY 17.10 per share

- 2025-09: CNY 15.92 per share

- 2025-10: CNY 16.12 per share

- 2025-11: CNY 15.57 per share

- 2025-12: CNY 15.13 per share

- 2026-01: CNY 15.63 per share

- 2026-02: CNY 15.47 per share

- 2026-03: CNY 14.65 per share

- 2026-04: CNY 14.42 per share

- 2026-05: CNY 13.74 per share

- 2026-06: CNY 12.19 per share

- 2026-07: CNY 13.44 per share

- 2026-08: CNY 13.08 per share

- 2026-09: CNY 13.34 per share

- 2026-10: CNY 13.07 per share

## Annual estimated value (CNY per share)

- FY2016: low CNY 6.77 per share, central CNY 9.26 per share, high CNY 10.71 per share

- FY2017: low CNY 7.90 per share, central CNY 10.94 per share, high CNY 12.72 per share

- FY2018: low CNY 10.97 per share, central CNY 15.11 per share, high CNY 17.52 per share

- FY2019: low CNY 11.72 per share, central CNY 15.85 per share, high CNY 18.30 per share

- FY2020: low CNY 15.42 per share, central CNY 21.10 per share, high CNY 24.41 per share

- FY2021: low CNY 13.25 per share, central CNY 18.16 per share, high CNY 21.02 per share

- FY2022: low CNY 12.37 per share, central CNY 16.99 per share, high CNY 19.68 per share

- FY2023: low CNY 11.65 per share, central CNY 16.05 per share, high CNY 18.61 per share

- FY2024: low CNY 8.15 per share, central CNY 9.04 per share, high CNY 10.24 per share

- FY2025: low CNY 8.82 per share, central CNY 10.46 per share, high CNY 11.84 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:44:21.695Z where newer inputs omit a numeric field or fiscal period.

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.