HONG KONG – Even as Asian markets wobble and investors scrutinize every move, Chinese drugmaker Yichang HEC Changjiang Pharmaceutical Co. Ltd., which focuses on developing, manufacturing and selling antiviral medicines, launched an IPO in Hong Kong Monday looking to raise as much as HK$1.67 billion (US$215 million).

The company is hoping that its focus on influenza, unique in Mainland China, and its growth story will prove attractive.

The company reported a turnover of ¥440.9 million (US$68.2 million) last year and net profits of ¥135.3 million. For the first six months of this year, the drugmaker saw its total revenue reach ¥382.9 million, up 58 percent from the same period a year earlier, with net profits jumping to ¥153.25 million by the end of June.

Even with a growth story generally viewed as solid and backup from the promise of growth in the health care and pharmaceutical markets in Mainland China, Yichang may need to come up with a very convincing argument if it is to attract investors. The challenge may not necessarily be within the company itself, which was founded in 2002 by one of China's largest private companies, the HEC Group, but with the state of the market. The Hang Seng Index in Hong Kong is down for the year and is now trading at 21,274 points, having started 2015 at 22,585.

After booming through the middle of the year, most biotech stocks on the market have retreated significantly tracking the wider market.

"Investors now are quite selective in taking on pharmaceutical stocks," said David Li, assistant vice president of health care research at Bocom International Holdings Co. Ltd. "Only those that can meet all these three criteria, including strong R&D capabilities, wide marketing networks and innovative products in high-demand sectors – for example, those targeting at cardiovascular disease and cancers – can make themselves stand out."

Mainland China's relatively high entry barriers to influenza drugs, which is the company's main focus, is the key selling point, Dong Suisui, Yichang's director of strategic development, told the investors in Hong Kong earlier this week.

Yichang's star product, influenza drug Kewei (oseltamivir phosphate), accounted for 8.2 percent of the market for influenza virus products in Mainland China in 2014, according to Guangzhou PICO Medicine Information, a consulting institute under State Food and Drug Administration. The company was ranked in the top four pharmaceutical manufacturing companies in the influenza market.

"There is unlikely to be any competition in the short to medium term for Kewei due the high research and envelopment costs involved in producing anti-influenza drugs, as well as the long pending process of gaining regulatory approvals in Mainland China," Dong told investors.

Kewei has been increasingly important in terms of revenue contribution. Sales accounted for 3.4 percent of the company's revenue in 2012 and have dramatically increased to 70.7 percent in the first six months of this year.

"We also plan to launch three new drugs in the next five years," Dong said, though she did not disclose further details of the potential products under development.

The China-based pharmaceutical manufacturer has other products that focus on treating endocrine and metabolic diseases and cardiovascular diseases.

Yichang is marketing its shares at a price range of HK$13.7 to HK$18.5. At that range, the price-to-earnings ratio of the company next year should range between 13.6 and 18.4.

That is slightly lower than most of its Hong Kong-listed peers such as Luye Pharma Group, Sino Biopharmaceutical Ltd. and CSPC Pharma Group Ltd., all of which are now trading at ratios of 20-times earnings or higher and are "top picks" among Mainland China pharmaceutical companies listed in Hong Kong, said Bocom's Li.

"We definitely see more mainland health care companies coming to Hong Kong for listing this year, and this would be the trend as they see many advantages here," said Li. "The IPO procedure is more standard and the pending time is rather shorter than the one in mainland and companies can draw more international investors on the platform in Hong Kong, which is a good start for them to gain a strong international presence."

According to its IPO prospectus report, Yichang will offer 90.13 million H-shares (H-shares are shares of companies from Mainland China traded in Hong Kong), of which 90 percent are for international placing and the rest for Hong Kong public offering. The company has already secured placements of as much as $62 million from four cornerstone investors.

The majority of the funds – as much as 60 percent – raised from the share sale will be used to build factories and for promotion and marketing.

The retail tranche opened Dec. 14 and will close Dec. 18, with a listing planned for Dec. 29.