A Valuation Model for the Development of Sinovac Biological Company under COVID-19 Shock

Abstract

This paper provides an in-depth study of the impact of the COVID-19 pandemic on the global economy and the pharmaceutical and medicine industry, focusing on the Chinese company Biologicals. The financial situation of Sinovac Biologicals before and after the pandemic is analyzed in depth by building a valuation model with data from two different time periods. Before the COVID-19, the company faced cash flow problems and a relatively low market capitalization. This is mainly because at that time, the company may not have been involved in areas related to vaccine production, and the market capitalization was constrained by market demand and industry competition. However, with the outbreak, the company became actively involved in the development and production of the COVID-19 vaccine, leading to a significant improvement in its free cash flow and a rise in its market capitalization. Although the model results emphasize this positive trend, this papermust keep in mind the model's uncertainty and risk factors. Future economic and market conditions are fraught with uncertainty, and Cochrane Biologics may also be exposed to other risks, such as volatility in the vaccine market, policy changes and increased competition. Therefore, a combination of these factors is critical to accurately assessing the company's valuation and prospects.