Tianmu Pharmaceutical (600671) Limit-Up Analysis: Stock Price Performance Driven by ST Designation Removal and Fundamental Improvement

Today’s limit-up of Tianmu Pharmaceutical is the result of multiple positive factors, which can be summarized into the following four core driving factors:

Tianmu Pharmaceutical successfully had its ST designation removed on May 20, 2025, reverting from “ST Muyao” to a normal listing status, with the daily price limit restored from 5% to 10% [1]. The removal of the ST designation signifies the improvement of the company’s fundamentals and the elimination of risks. This major positive factor continues to attract capital attention, becoming one of the core catalysts driving the stock price upward.

On December 18, 2025, Huangshan Tianmu, a wholly-owned subsidiary of the company, received the “Drug Re-registration Approval Notice” issued and approved by the Anhui Provincial Medical Products Administration. The approved drugs include 7 varieties such as Zhibai Dihuang Pills, Shujin Huoxue Tablets, Guifu Dihuang Pills, Guipi Pills, Anshen Buxin Pills, Duzhong Granules, and Huanglian Shangqing Tablets [2]. The successful drug re-registration ensures the stable continuation of the production and sales qualifications of the company’s core drugs, providing a fundamental guarantee for future performance growth.

According to the 2025 third quarterly report, the company achieved operating revenue of RMB 159 million in the first three quarters, a year-on-year increase of 27.48%; net profit attributable to shareholders was RMB 14.2088 million, surging 484.48% year-on-year; and non-recurring net profit was RMB 10.883 million, a year-on-year increase of 238.38% [3]. The significant improvement in profitability indicates that the company’s operating condition continues to improve, and the fundamental improvement provides solid support for the stock price increase.

Recently, the TCM sector has performed actively driven by policy support and expectations of growth in innovative TCM research and development. As a member of the TCM sector, Tianmu Pharmaceutical has benefited from the sector rotation effect [4] and gained favor from market capital.

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Time Period	Price Change	Performance Evaluation
Single Day	+9.99%	Limit-Up [0]
5 Days	+16.05%	Strong Rise [0]
Monthly Change	+15.65%	Sustained Uptrend [0]
Annual Change	+130.90%	Substantial Increase [0]
6-Month Change	+43.52%	Mid-term Strength [0]

From the capital perspective, the main capital has been in a continuous net inflow state recently. Data shows that the main capital had a net purchase of RMB 1.5611 million on January 15 [5], reflecting institutional investors’ optimistic attitude towards the company’s prospects. At the same time, the number of shareholders has decreased to 9,700, a slight decrease from the previous period, and the shareholding has become more concentrated [6], which is conducive to the stable rise of the stock price.

Indicator	Value/Status	Signal Interpretation
MACD	Bullish Crossover	Uptrend Under Confirmation [0]
KDJ	K=76.6, D=64.8, J=100.4	Overbought Zone, Wary of Pullback [0]
RSI	Overbought Risk Zone	Short-term Adjustment Risk [0]
Beta	0.12	Low Correlation with Market Index, High Independence [0]

: Support level at RMB 17.89, resistance level at RMB 20.25 (already broken), next target at RMB 20.82 [0].

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Although the company’s fundamental improvement supports the stock price increase, investors still need to pay close attention to the following risk factors:

: The company’s current PE ratio is 74.39x and PB ratio is 37.03x, both at historical highs [0]. High valuation means that the market has high expectations for the company’s future growth. Once performance falls short of expectations, the stock price may face valuation pullback pressure.

: From the technical indicators, the J value of the KDJ indicator has exceeded 100, and the RSI is also in the overbought zone [0], indicating a short-term adjustment demand. Historical data shows that such overbought conditions are often accompanied by short-term pullbacks.

: Although the overall performance in the first three quarters has improved significantly, the net profit in Q3 alone was only RMB 3.961 million, a month-on-month decrease of 73.25% [3]. This quarterly performance fluctuation reflects that the company’s profit stability still needs to be improved.

: The company’s debt ratio is as high as 78.06% [3], resulting in relatively high financial pressure, and it may face liquidity risks during economic downturns or when industry policies are tightened.

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Based on the above analysis, the following scenario forecasts are made for Tianmu Pharmaceutical’s future trend:

Scenario	Probability	Trigger Condition
Continued Strength	40%	Continue to rise after stabilizing above RMB 20.25, target range RMB 20.82-21
Consolidation with Fluctuations	35%	Fluctuate within the range of RMB 19-21 to digest profit-taking orders
Short-term Pullback	25%	Stabilize after testing the support level at RMB 17.89

:

• Aggressive Investors
  : May appropriately build positions when the price pulls back to the range of RMB 18.5-19, with a stop-loss level set at RMB 17
• Conservative Investors
  : It is more prudent to wait for the stock price to test the 20-day moving average (about RMB 17.5) and confirm support before entering the market
• Risk Warning
  : Given that both RSI and KDJ are currently in the overbought zone, investors should not chase the upward trend, and should pay close attention to changes in trading volume and sector rotation.

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Today’s limit-up of Tianmu Pharmaceutical is the result of the combined effect of three factors: ST designation removal, fundamental improvement, and sector rotation. The company’s financial data has improved significantly, and the approval of re-registration for 7 drug varieties provides fundamental support, but the current valuation is high and technical indicators show overbought risks. Investors may consider laying out positions on pullbacks, but need to pay attention to short-term pullback risks, and closely monitor changes in trading volume and sector rotation. In the medium term, the company’s fundamental improvement trend is clear. If it can maintain stable performance growth, the stock price still has room for further upward movement.