Bairui's fundraising was cut by 70%, raising concerns about growth potential, with valuations even lower than three years ago | Understanding IPO

问AI · 如何突破防粘连市场瓶颈与护肤品亏损困局？

来源|时代商业研究院

作者|陈佳鑫

编辑|韩迅

Reducing the “fundraising amount” during the IPO period to increase the probability of “passing” is a strategy employed by many companies, but a reduction of nearly 70% is rare.

On January 21, Changzhou Baijiji Biological Pharmaceutical Co., Ltd. (hereinafter referred to as “Baijiji”) successfully passed the meeting and plans to list on the Beijing Stock Exchange. However, on the eve of the meeting, Baijiji canceled its original research and development center construction project, drastically lowering the planned fundraising amount from 350 million yuan to 106 million yuan, a reduction of nearly 70%, which has drawn widespread attention from the capital market.

The reduction in the planned fundraising amount is, to some extent, a form of self-devaluation. According to both versions of the prospectus, although the fundraising amount was lowered, the expected number and proportion of new shares issued by Baijiji remained unchanged, indicating that after adjusting the fundraising amount, Baijiji’s overall valuation fell by about 70%, even dropping well below the level of 2023.

Baijiji’s main product is cross-linked sodium hyaluronate gel for intrauterine use, with its core purpose being postoperative adhesion prevention. The market space is limited, and Baijiji is also trying to expand its development space through cross-border skincare products, but this business continues to incur losses.

The “halving” of Baijiji’s fundraising scale is by no means accidental but reflects the rational assessment of the company’s future growth potential by the market and regulatory authorities, and highlights the concentrated manifestation of its core business development bottlenecks and uncertainties in its cross-border layout.

From March 19 to 23, the Times Business Research Institute sent letters and made multiple phone calls to inquire about growth space, collective procurement impact, skincare business, and other issues, but the investor contact numbers were all turned off, and as of the time of publication, there has been no response to related questions.

Valuation soared 200% over six months, then dropped about 70% during the IPO

It is noteworthy that after adjusting the IPO planned fundraising amount, Baijiji’s valuation has even fallen below that of three years ago.

According to the public transfer document disclosed by Baijiji before its listing on the New Third Board, in June 2022, Baijiji had its first equity transfer during the reporting period, where shareholder Jiangsu Jiuzhou transferred 6.97177% of its shares in Baijiji for 34.858850 million yuan, corresponding to an overall valuation of 500 million yuan.

More than six months later, in January 2023, Baijiji had its second equity transfer during the reporting period, where controlling shareholder Shu Xiaozheng transferred 0.66667%, 0.66667%, 0.66667%, 0.66667%, 0.66667%, 0.20000%, and 0.13333% of his shares in Baijiji to seven institutions and individuals, with a total transaction price of 55 million yuan, corresponding to an overall valuation of about 1.5 billion yuan, marking a 200% increase in valuation in just over six months.

After that, it entered the IPO process. According to the first version of the prospectus (application draft) in December 2024, Baijiji plans to publicly issue no more than 9.2072 million new shares to unspecified qualified investors, accounting for 13.30% of the total shares after this issuance, with an expected fundraising amount of 350 million yuan, estimating Baijiji’s overall valuation to be about 2.632 billion yuan.

By the time of the latest version of the prospectus in January 2026 (meeting draft), Baijiji also plans to publicly issue no more than 9.2072 million new shares to unspecified qualified investors, accounting for 13.30% of the total shares after this issuance, and while the expected number and proportion of new shares issued remained unchanged, the expected fundraising amount was reduced to 106 million yuan. Based on this, Baijiji’s overall valuation is estimated to be about 797 million yuan, a decline of about 70% over more than a year, even far below the valuation level of January 2023.

Since 2022, Baijiji has experienced rapid valuation growth (soaring 200% in over six months) and then a rapid decline during the IPO period (a drop of about 70% over more than a year). Against the backdrop of overall stable performance, the magnitude of valuation fluctuations is puzzling.

Limitations in the field of adhesion prevention

The drastic cut in the fundraising amount may reflect the inherent limitations of the market segment Baijiji occupies, as well as the impacts of industry policies and market competition, which have severely compressed the growth space of this business, becoming a bottleneck restricting corporate development.

The market size for postoperative adhesion prevention materials is small. Baijiji’s core profit source is postoperative adhesion prevention materials for intrauterine surgery, and the market capacity of this niche area is relatively limited. According to the data from Baijiji’s inquiry response document, the market size for postoperative adhesion prevention materials in China was only 1.389 billion yuan in 2023, while the market size for nasal (sinus) cavity postoperative adhesion prevention materials was merely 220 million yuan. The combined market size of these two core segments is less than 1.6 billion yuan, which means that even if Baijiji occupies a high market share, it is difficult to achieve significant scale breakthroughs, and performance growth faces a natural ceiling.

The postoperative adhesion prevention market for the pelvic (abdominal) cavity is one of the larger areas within the adhesion prevention market. To break through this growth bottleneck, Baijiji is trying to expand into this field. In 2023, the market size of this field reached 2.336 billion yuan, nearly 1.7 times that of the intrauterine field.

However, the competitive landscape in this field has basically stabilized. According to data from Frost & Sullivan research, in 2023, based on product manufacturers, companies such as Sika, Dicon Zhongke Biological, Shijiazhuang Yishengtang, Hangzhou Xiehe, and Haohai Biological occupy the main market share in this field.

More critically, in the current postoperative adhesion prevention market for the pelvic (abdominal) cavity, “membrane materials” and “liquid materials” occupy almost the entire market share, while Baijiji’s products belong to semi-solid biomaterials, which differ from the mainstream product forms in the market. Market education and acceptance require a long cycle, making it difficult to contribute substantial incremental growth in the short term.

Furthermore, under the impact of centralized procurement policies, the market space for postoperative adhesion prevention may shrink further. In recent years, China has clearly proposed to carry out centralized bulk procurement of high-value disposable medical supplies, with adhesion prevention materials being an important category of medical consumables, naturally included in the scope of centralized procurement.

Previously, Henan and Yunnan provinces had respectively conducted centralized procurement for adhesion prevention materials, with Yunnan’s procurement covering six categories of medical consumables, including adhesion prevention materials, with an average price reduction of 71.42%, and some categories seeing reductions exceeding 90%.

Faced with the price reduction pressure brought by centralized procurement, Baijiji chose to forgo participation in the centralized procurement in Henan province. Although this avoided the price drop impact in the short term, it also means that the company may lose the market for public medical institutions in that region, further shrinking its market coverage. If subsequent centralized procurement policies for adhesion prevention materials are further promoted nationwide, the overall market space for Baijiji’s adhesion prevention materials may shrink.

The two-invoice system has also impacted Baijiji’s sales system. Baijiji’s product sales are highly reliant on the distributor system, with 76.72% of revenue in 2024 coming from the distribution model. Under the two-invoice system, Baijiji is required to take on more sales responsibilities. In Baijiji’s sales areas, the two-invoice system for high-value medical consumables, including adhesion prevention materials, has already been implemented in parts of Shaanxi and Qinghai provinces.

Moreover, the stability of Baijiji’s distributor team has been declining in recent years. Data shows that from 2022 to the first half of 2025, the number of distributors cooperating with Baijiji was 381, 375, 284, and 182, showing a year-on-year decreasing trend; during the same period, the number of distributors that exited was 156, 127, 194, and 149, with the number of distributors exiting in the first half of 2025 reaching as high as 81.87%. The revenue brought by the exited distributors accounted for 46.34%, indicating a worrying stability of the channels.

In response, Baijiji stated in its inquiry response that there are significant fluctuations in the number of distributors among peers, and its distributor changes are in line with industry practices. However, from the peer data it listed, most peers only had a higher exit ratio in certain years, and their overall level is lower than that of Baijiji.

Is entering the skincare field reliable?

Perhaps realizing the growth limitations of the adhesion prevention materials market, Baijiji has chosen to cross over into the skincare field, attempting to break through its growth bottlenecks by leveraging the vast space of the skincare market. The skincare products it launched include masks and creams. According to Zhiyan Consulting’s estimates, by 2025, the scale of China’s mask market alone could reach 76.79 billion yuan, seemingly offering a broad market space. However, behind this “blue ocean” is a level of competition far exceeding that of the adhesion prevention field, revealing multiple hidden concerns in Baijiji’s cross-border attempt.

Firstly, although the skincare market is large, the competitive landscape is extremely fragmented, particularly in the mask sector, which exhibits a “hundred flowers bloom” pattern. According to data from Forward Industry Research Institute, the market share of the top 15 mask brands combined is only 28.4%, indicating that most of the market share is divided among numerous small and medium-sized brands. According to incomplete statistics, there are currently over 7,000 mask brands in China, while the functional skincare sector has gathered numerous strong players like Beitaini, Huaxi Biological, Juzhibio, and Fuirjia, forming a clear competitive hierarchy.

Although Baijiji’s skincare business has shown rapid growth, with revenues of 27.2174 million yuan, 44.0965 million yuan, and 52.9338 million yuan from 2022 to 2024, reflecting a compound annual growth rate of nearly 40%, it still belongs to the category of small and medium players in the face of the enormous market scale, making it extremely difficult to break through in fierce competition.

Secondly, the high growth rate of Baijiji’s skincare business is partially built on high sales expense investments. Data shows that from 2022 to 2024, the sales expenses for its skincare business were 25.0882 million yuan, 32.0254 million yuan, and 41.1728 million yuan, with sales expenses climbing year by year. For example, in 2024, Baijiji’s skincare business needed to spend 78 yuan in sales expenses for every 100 yuan of revenue.

The high sales expenses are one of the main reasons for the continuous losses in its skincare business. From 2022 to 2024, Baijiji’s skincare business incurred losses of 11.4073 million yuan, 7.5458 million yuan, and 12.0967 million yuan, and Baijiji has clearly stated in its inquiry response document that it expects this business to remain in a state of loss or slight profit for the next few years.

Thirdly, the conservative choice for cross-border expansion has widened the gap with peers. Similarly engaged in both adhesion prevention materials and skincare fields, Baijiji’s peer Haohai Biological has chosen to enter the medical aesthetics product sector, which has higher barriers and profit margins, while Baijiji has opted for the more fiercely competitive general skincare field.

In 2024, Haohai Biological’s (688366.SH) medical aesthetic products have become its largest business, and the primary source of gross profit, with a gross profit margin of as high as 49.11%. According to Haohai Biological’s 2024 annual report data, its total operating revenue reached 2.698 billion yuan, with a net profit attributable to the parent company of 420 million yuan, showcasing stable profitability.

In contrast, Baijiji has clearly stated in its inquiry response document that it does not have the production capacity for medical aesthetic products and does not engage in medical aesthetics products, and it has not included medical aesthetics products in its future business expansion plan. The skincare products chosen by Baijiji may represent a cross-border path that is easy to enter but difficult to progress, and while it is in a phase of rapid growth, the future of this business remains uncertain.

Four, core viewpoint: Breaking the growth space doubt is key

Baijiji’s successful passing undoubtedly injects a strong shot of confidence into its development, but the 70% slash in the intended fundraising amount reflects hidden worries about the company’s growth space and the accumulation of multiple risks. The core business of adhesion prevention materials faces multiple risks such as a small market size, impacts from centralized procurement, and unstable distributors, with a clear growth ceiling; while the cross-border entry into the skincare field, although offering broad market space, is marked by fierce competition and profitability challenges, making it difficult to become the core growth engine of the company in the short term.

For Baijiji, to dispel regulatory and market doubts about its growth capability, it needs to deepen its focus on the core business of adhesion prevention, increase R&D investment, optimize product structure, enhance product competitiveness, actively respond to the shocks brought by centralized procurement policies, stabilize the distributor system, and expand market share; on the other hand, in the layout of the skincare field, it needs to rationally control sales expenses, focus on product R&D and brand building, and seek differentiated competitive advantages to gradually achieve profitability.

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