Hong Kong’s government officially released the "Chinese Medicine Development Blueprint" on December 18, outlining five key areas, eight major goals, and 20 action plans to promote comprehensive, high-quality, and high-level development of traditional Chinese medicine (TCM) in the region. CITIC Securities noted in a recent report that short-term pressure on the TCM industry is expected to ease, with accelerated inventory clearance and a potential demand recovery by year-end, alongside improving fundamentals and valuation opportunities. Related stocks include TRAD CHI MED (00570), TONGRENTANGCM (03613), GUSHENGTANG (02273), and BAIYUNSHAN PH (00874).
The eight key goals of the blueprint include: 1. Optimizing clinical services by establishing TCM’s role in the healthcare system, improving service quality, and leveraging technology for upgrades. 2. Building an interdisciplinary service system through deeper collaboration with mainstream healthcare and strengthening TCM’s role in primary care. 3. Advancing TCM professionalism by enhancing training standards and talent development. 4. Elevating herbal medicine quality via stricter management and full implementation of Good Manufacturing Practices (GMP). 5. Establishing international TCM standards through cooperation with mainland China and the Greater Bay Area. 6. Driving innovation in research and industry, including clinical trials and talent cultivation. 7. Promoting TCM culture through public education and cross-sector collaboration. 8. Expanding TCM globally by showcasing Hong Kong’s model and fostering international cooperation.
Secretary for Health Lo Chung-mau stated that the blueprint aims to enhance public healthcare through TCM, positioning Hong Kong as a global hub for TCM development.
Recent milestones in Hong Kong’s TCM sector include the inaugural Greater Bay Area TCM Innovation Conference in early December, attended by 800 global experts, and the launch of Hong Kong’s first dedicated TCM hospital on December 11, offering outpatient and day-patient services across six specialties.
CITIC Securities anticipates a rebound in TCM demand by year-end, with innovation driving long-term growth. Huajin Securities highlights "premium + innovation" as key investment themes, noting strong brand value for high-end TCM products and policy-backed opportunities for novel TCM drugs. Huachuang Securities expects a sector recovery by 2026, prioritizing hospital-administered TCM, OTC drugs, and tonics.
**Related Stocks**: - **TRAD CHI MED (00570)**: A leading TCM manufacturer with a focus on R&D and production. H1 2025 revenue fell 11% YoY to RMB 7.46 billion, but gross margin edged up to 48.7%. - **TONGRENTANGCM (03613)**: A 350-year-old TCM brand with iconic products like Angong Niuhuang Wan, spanning cardiovascular, pediatric, and gynecological treatments. - **GUSHENGTANG (02273)**: Expanding globally, it recently partnered with Singapore’s 1doc to establish TCM clinics, adding 14 new locations. - **BAIYUNSHAN PH (00874)**: Reported a 4.31% YoY revenue growth to RMB 61.6 billion in Q1-Q3 2025, with net profit up 4.78%.
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