CONBA(SH:600572) Xin Lang Cai Jing·2025-12-12 08:29Core Viewpoint - The resignation of Jiang Yi, the chairman of Zhejiang Kang En Bei Pharmaceutical Co., has raised concerns about the company's internal governance and strategic continuity amid poor performance and a long-term decline in stock price [1][7]. Group 1: Frequent Personnel Changes and Governance Stability - Jiang Yi's departure is attributed to "work adjustment," but details are lacking, leading to questions about governance stability [2]. - His tenure was brief, having joined the board at the end of 2023 and becoming chairman in August 2024, only to resign in December 2025, indicating a lack of long-term succession planning [2][8]. - The market is concerned about whether the successor can maintain the established strategy and how decision-making will remain coherent during the transition [2][8]. Group 2: Weak Financial Growth and Core Profitability Pressure - For the first three quarters of 2025, the company's revenue grew only 1.27% year-on-year, indicating stagnation [3][9]. - The growth in net profit is largely driven by non-recurring gains, with the growth rate of net profit excluding non-recurring items at just 1.61%, showing limited improvement in core profitability [3][9]. - The company's revenue compound annual growth rate over the past three years is approximately -1%, with a concerning long-term decline in gross margin from 77.11% in 2018 to 53.14% in 2024 [3][9]. Group 3: Strategic Implementation Challenges - The company claims to adhere to a "one body, two wings" strategy, focusing on traditional Chinese medicine, chemical drugs, and health consumer products, but the chemical drug segment has seen a decline [4][10]. - The stock price has remained low, with a market value that has shrunk by about 80% from its peak, and the stock has underperformed the Shanghai Composite Index by over 16% this year [4][10]. - The failure in market capitalization management, combined with weak performance and unclear governance prospects, has created a negative feedback loop [4][10]. Group 4: Outlook for Rebuilding Trust through Governance - The current crisis presents an opportunity for the company to reshape governance and regain confidence [5][11]. - The company needs to go beyond procedural disclosures and respond transparently to market concerns, detailing the decision-making process during the transition and the qualifications of new board members [5][11]. - Strengthening financial and business disclosures, along with clarifying the path to improving profit quality, is essential for restoring investor relations and transforming the current turmoil into a governance upgrade [5][11].