Lepu Medical Technologies and Tenfu Holdings are not names that will be familiar to many – but both are at the forefront of China’s economic development. Both are relatively small, listed companies and both are trying to make higher profit margins by doing more sophisticated things or, in the economists’ vernacular, “moving up the value chain”.
Lepu, a roughly $1.7bn company listed in Shenzhen since 2009, designs and makes stents, pacemakers and other high-tech medical products. This is a business that requires the manufacturing process to be of high quality and reliability, as well as significant research and development.
By contrast, Hong-Kong-listed Tenfu, worth near-$1bn, makes tea – traditional Chinese tea. It is creating a higher-end brand to differentiate its tea from everything else on the supermarket shelves. It is more a Twinings or Whittard than a PG Tips.