Annual Report Insight of the SSE STAR Market: 54 Unprofitable Companies Reduce Losses by 36%, and 3 Companies Successfully Shed "U" Mark

Translated from Securities Daily, Tian Peng

Since its opening, the SSE STAR Market has focused on the field of scientific and technological innovation and fully supported the development of unprofitable enterprises. In 2024, three companies—Sinocelltech Group Limited (SinoCellTech) in Beijing, Sichuan Biokin Pharmaceutical Co., Ltd. (Biokin) in Chengdu, and Shanghai MicroPort EP MedTech Co., Ltd. (MicroPort EP)—successfully shed the "U" mark in their stock codes. So far, a total of 22 unprofitable enterprises listed on the STAR Market have shed the "U" mark, accounting for 41% of the total number of unprofitable enterprises at the time of listing.

Overall revenue hits a new high

As a "test field" for capital market reform, the STAR Market has attracted many sci-tech innovation enterprises with its diverse and inclusive issuance and listing conditions. Since the release of the Eight Measures for Deepening the Reform of the SSE STAR Market to Serve Science and Technology Innovation and the Development of New Quality Productive Forces, more unprofitable companies have gained the opportunity to go public. Currently, 54 unprofitable companies have been listed on the STAR Market. In 2024, the revenue scale of these enterprises reached a new high, with a total operating income of RMB 174.479 billion, up 24% year-on-year, higher than the overall growth rate of the market. The net loss attributable to the parent company was RMB 13.641 billion, down 36% year-on-year, and the compound growth rate of operating income from 2019 to 2024 reached 26%. In the sub-sectors, most unprofitable companies in the biomedical field have launched their own products on the market, and unprofitable companies in the integrated circuit field are increasingly promoting domestic supply capabilities.

Benchmarks of innovative development have emerged one after another

Some unprofitable enterprises have opened up new paths for innovative development. Biokin's revenue in 2024 was RMB 5.8 billion, a year-on-year increase of 936%. With its core product BL-B01D1, it has reached high-value global strategic cooperation with multinational pharmaceutical companies and achieved its first profit. As the first manufacturer in China to provide complete solutions for three-dimensional cardiac electrophysiology equipment and consumables, MicroPort EP has perfected its product layout after listing. In 2024, its overseas revenue reached RMB 112 million, a year-on-year increase of 62.94%. This indicates that its globalization strategy is beginning to yield results.

High R&D investment builds a solid competitive barrier

Unprofitable companies listed on the STAR Market continue to increase their R&D investment to drive the improvement of independent innovation capabilities. In 2024, the total R&D investment was RMB 45.944 billion, with a year-on-year increase of 5.86%. Their proportion of R&D investment in revenue reached 26%, which is higher than the overall level of the market. In terms of talent and patents, by the end of 2024, there were 32,000 R&D personnel with 17,000 patents, including 8,000 invention patents. SICC Co., Ltd. launched the world's first 12-inch silicon carbide substrate product, marking that China's third-generation semiconductor field is moving towards "global leadership".

Looking ahead, as unprofitable enterprises transition into a virtuous development cycle, more companies listed on the STAR Market are expected to shed the "U" mark in their stock codes, further energizing the hard-tech investment ecosystem.

The above information is provided for reference purposes only and does not constitute investment advice.