China TCM Monthly Tracker: Raw material prices down 15% YoY in 5M26, down 1% MoM in May
Institutional-grade analysis used by equity desks before repricing events. 16 pages.
Report fact snapshot
- Publisher
- UBS
- Date
- 2026-06-11
- Type
- Market Report
- Region
- China
- Sector
- Healthcare & Biotech
- Companies
- Dong-E E-Jiao, CR Sanjiu
Market is pricing this as noise.
Data shows a structural shift is underway.
Sector models are broken — re-rating is imminent.
Based on UBS research, June 2026 data and regional breakdowns
Key Signals
Market is pricing this as noise.
Data shows a structural shift is underway.
Why it matters: Identifies the exact point where consensus models diverge from actual data.
A re-rating catalyst is approaching.
Consensus has not yet reflected this shift.
Why it matters: Frames the catalyst window before violent repricing begins.
Winners are concentrated in this space.
Specific companies are structurally outperforming.
Why it matters: Tracks the capital rotation toward structural winners before it becomes consensus.
What You Gain From This Report
Decision Insight
Mispricing is not yet reflected in consensus models.
Missed Risk
Without the full report, you miss the company-level breakdown that separates winners from losers.
Timing Advantage
The catalyst window is open now — consensus repricing will close it within quarters.
What you miss without the full report:
- Company-level positioning and stock picks
- Valuation assumptions and model inputs
- Price target logic and catalyst timeline
Why Institutional Investors Care
Mispricing windows like this typically precede sector re-rating events.
Early positioning in structural winners often leads to outsized returns when consensus catches up.
The catalyst window narrows as monthly data becomes consensus, making near-term positioning critical.
Report Summary
TCM raw material prices continued their downward trend, with the TCM Raw Materials Price Composite 200 Index falling 15% YoY in the first five months of 2026 and 1% MoM in May, driven by high inventories and sufficient production capacity. Imported donkey hide supply remains robust, suggesting no cost pressure for the e-jiao sector, while natural bezoar prices started to fall in H2 2025, potentially easing margin pressure for key products like Angong pills.
Institutional Content Below
Full PDF (16 pages), valuation models, broker logic, and detailed charts.
Key Takeaways
- TCM raw material costs account for ~70% of TCM companies' total COGS, and the persistent downtrend since H2 2024 is expected to benefit gross margins across the sector
- Imported donkey hide supply (proxied by whole equine hide/skin imports) remains robust in 2021-23 and YTD, indicating sufficient inventories for domestic e-jiao manufacturers; e-jiao trading prices have fallen 5% YoY YTD
- Natural bezoar prices began declining in H2 2025, which could ease gross margin pressure for Angong pills and Pian Zai Huang's liver lozenges
- Among TCM coverage, Dong-E E-Jiao is preferred for high earnings growth visibility and improving margins, while CR Sanjiu is favored for its diversified product portfolio and strong cost control
Topics Covered
Companies Mentioned
Who this summary is for
This summary is for users researching the UBS China TCM Monthly Tracker report. It helps users review China TCM Monthly Tracker: Raw material prices down 15% YoY in 5M26, down 1% MoM in May coverage, key takeaways, and related broker or sector research paths across Traditional Chinese Medicine, Raw material prices, Healthcare sector; Dong-E E-Jiao, CR Sanjiu.
Related Search Paths
Use these links to continue through broker, sector and report-type research summaries.
Request Full PDF Access
Get access to the full broker report, including company-level details, valuation assumptions, charts, and price target logic.
Access is provided through VIP service or request confirmation.