France-based Sanofi S.A. (FR:SAN) is expanding its presence in China with an investment of €1 billion to build a new insulin manufacturing plant in Beijing. This represents Sanofi’s largest-ever investment in the region, defying the recent trade frictions between China and the EU (European Union). Once operational, this will become Sanofi’s fourth production and supply facility in China.
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Sanofi is a global pharmaceutical company that provides a wide range of medicines and vaccines. Year-to-date, Sanofi’s stock has risen just 1%.
Sanofi Unveils $1B Plan to Boost Insulin Supply
With this investment, Sanofi aims to establish a new insulin production base in China, boosting its overall supply. The company agreed to collaborate with the Beijing Municipal Bureau of Economy and Information Technology and the BDA (Beijing Economic-Technological Development Area) Administrative Committee to build the new facility in Beijing. This production site will be in the Beijing Economic and Technological Development Zone.
Additionally, the company noted that the new production facility will be equipped with state-of-the-art automated technologies and sustainable environmental practices. Sanofi believes the new plant will strengthen the company’s supply chain system while effectively meeting the increasing demand for insulin.
Meanwhile, Chinese authorities welcomed the investment and stated that the country will maintain its market openness amid trade tensions. China is also currently working to deepen its economic relations with individual states of the EU.
Is Sanofi a Good Stock to Buy?
Last week, analyst Florent Cespedes from Bernstein reiterated a Buy rating on the stock, predicting an upside of 25%.
As per TipRanks’ consensus, SAN stock has received a Moderate Buy rating, backed by nine Buys, three Holds, and one Sell recommendation. The average Sanofi share price target is €112.85, which is 23.34% above the current trading levels.
