Analysis Report on Accounts Receivable Turnover Days of Buchang Pharma (603858)

Based on the collected financial data and market information, I now provide you with a comprehensive analysis report on the accounts receivable turnover days of Buchang Pharma.

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According to Buchang Pharma’s 2024 annual report and historical financial data[0][1]:

Indicator	2024	2023	Year-on-Year Change
Amount of Accounts Receivable	RMB 893 million	RMB 1.568 billion	-43.01%
Operating Revenue	RMB 11.006 billion	RMB 13.245 billion	-16.91%
Accounts Receivable Turnover Days	Approximately 40.8 days	Approximately 45.0 days	-4.2 days
Ratio of Accounts Receivable to Operating Revenue	8.1%	11.8%	-3.7 percentage points

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Accounts receivable turnover days is a core indicator for measuring an enterprise’s collection efficiency, calculated by the following formula:

Accounts Receivable Turnover Days = 365 ÷ (Operating Revenue ÷ Average Accounts Receivable)

This indicator reflects the average number of days required for an enterprise to collect payments from the formation of accounts receivable.

.

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According to the analysis results, Buchang Pharma’s accounts receivable turnover days decreased from approximately 45 days in 2023 to approximately 40.8 days in 2024[0][1],

, which indicates that:

• Faster Collection Speed
  : The company’s average collection period shortened by approximately 9.3%
• Improved Collection Efficiency
  : The company’s collection ability has significantly improved compared to the previous year
• Improved Capital Recovery
  : In 2024, accounts receivable dropped significantly by 43.01% year-on-year, far exceeding the revenue decline (16.91%), indicating that the company has strengthened its accounts receivable management

According to the accounts receivable aging structure disclosed in Buchang Pharma’s 2024 audit report[2]:

Aging Period	Amount (RMB)	Proportion	Bad Debt Provision Ratio
Within 1 Year	RMB 842 million	87.3%	5%
1-2 Years	RMB 97 million	10.1%	15%
2-3 Years	RMB 11 million	1.1%	30%
Over 3 Years	RMB 14 million	1.5%	50%-100%

, indicating that the company’s overall accounts receivable is of high quality and the bad debt risk is controllable.

Industry/Company	Accounts Receivable Turnover Days (2024)
Buchang Pharma	40.8 days
Pharmaceutical Manufacturing Industry Average	Approximately 83.8 days
Pharmaceutical Distribution Industry Average	Approximately 107 days
Comparable TCM Enterprise (Yaoshi Tech)	Approximately 110 days
Comparable TCM Enterprise (Borui Pharma)	Approximately 96 days

Buchang Pharma’s accounts receivable turnover days are

, indicating that its collection pressure is much lower than that of peer enterprises[3][4].

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According to the company’s annual report explanation, the main reason for the significant decline in accounts receivable in 2024 is “

”[1], indicating that the company has adopted effective collection measures.

The company has established a nationwide marketing network covering 34 provincial administrative regions[1] by dispatching professional academic promotion teams through its business divisions and building long-term stable cooperative relationships with distributors, which is conducive to maintaining customer relationships and ensuring collection.

Most of the company’s top five customers are medical institutions and large pharmaceutical commercial companies, with relatively guaranteed collection credit. From the perspective of the aging structure, the proportion of accounts receivable within 1 year is as high as 87.3%[2], reflecting good payment ability of customers.

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• ✅ Accounts receivable turnover days continue to decline, with improved collection efficiency
• ✅ The ratio of accounts receivable to operating revenue is low (only 8.1%)
• ✅ Healthy aging structure, with the proportion of accounts receivable over 1 year being less than 13%
• ✅ Better than the industry average, with controllable bad debt risk

• ⚠️ Operating revenue continues to decline (year-on-year decrease of 16.91% in 2024), requiring attention to business sustainability
• ⚠️ Short-term borrowings increased by 102.59%[1], indicating pressure on liquidity management
• ⚠️ In 2024, the net profit attributable to shareholders of the listed company was negative (RMB -554 million), resulting in operating pressure

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1. Higher Turnover Efficiency Than the Industry
   : Only about half of the average level of the pharmaceutical manufacturing industry, reflecting strong collection ability
2. Favorable Trend in Turnover Change
   : The turnover days decreased by 4.2 days year-on-year, indicating accelerated collection speed
3. High Quality of Accounts Receivable
   : Healthy aging structure, with over 87% of accounts receivable within 1 year, and controllable bad debt risk
4. Limited Capital Pressure
   : The low ratio of accounts receivable to operating revenue is conducive to cash flow management

Overall, Buchang Pharma has performed well in accounts receivable management, and its collection pressure is at a controllable level. However, it is necessary to comprehensively assess the overall financial situation in combination with operating pressures such as net profit loss and revenue decline.

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[0] Sina Finance - Financial Summary of Buchang Pharma (http://vip.stock.finance.sina.com.cn/corp/go.php/vFD_FinanceSummary/stockid/603858/displaytype/4.phtml)

[1] 2024 Annual Report of Shandong Buchang Pharmaceutical Co., Ltd. (http://static.cninfo.com.cn/finalpage/2025-04-26/1223325841.PDF)

[2] 2024 Audit Report of Shandong Buchang Pharmaceutical Co., Ltd. (https://stockn.xueqiu.com/SH603858/20250425335542.pdf)

[3] New Century Rating - 2024 Credit Review and 2025 Outlook for the Pharmaceutical Manufacturing and Distribution Industry (https://aigc.idigital.com.cn/djyanbao/【新世纪评级】医药制造与流通行业2024年信用回顾与2025年展望-2025-01-22.pdf)

[4] Reply of Shanghai Haoyuan Pharmaceutical Co., Ltd. to the Regulatory Inquiry Letter on 2024 Annual Report Information Disclosure (https://static.cninfo.com.cn/finalpage/2025-06-26/1223982806.PDF)