IPO Pricing | Gosengtang was subscribed 2.84 times, priced at HK$29 per share

Futu News, December 9, this Thursday$GUSHENGTANG (02273.HK)$ An announcement was issued. The company will issue 278.78 million shares, with a limited price of HK$29, of 100 shares per lot. It is expected to be listed on December 10.

During the public sale phase, Gushengtang was subscribed about 2.84 times, and the final number of shares distributed until the public sale was 2.787,800 shares, accounting for 10% of the total number of shares offered (before any over-allotment rights were exercised). A total of 11087 valid applications were received, with a winning rate of 60% for the first hand, and securing the first hand for the second subscription.

Furthermore, the international offering was moderately oversubscribed. The final number of shares offered was approximately 25.902 million shares, equivalent to 90% of the total number of shares offered (before any overallotment rights were exercised). Futu Information collates relevant data in the following table:

The net proceeds of approximately HK$705 million will be used for the following purposes: about 69.8% will be used to expand online and offline business integration; about 9.6% will be used to strengthen R&D capabilities; about 9.6% will be used to strengthen supply chain capabilities; about 4.9% will be used for marketing and brand promotion activities; and approximately 6.0% will be used for working capital and general corporate purposes.

Gushengtang is a TCM healthcare service provider in China. It provides customers with comprehensive TCM healthcare services and products through offline medical institutions and online healthcare platforms.

According to Frost & Sullivan's data, in terms of total revenue from providing healthcare solutions in 2020, the company ranked 8th among private new TCM healthcare service providers in China, with a market share of 0.6%.

In terms of financial data, the company's total revenue from 2018 to 2020 was RMB 726 million, RMB 896 million and RMB 925 million respectively, with a compound annual growth rate of 12.9%; adjusted net profit of -RMB 68 million, RMB 77 million and RMB 85 million were recorded during the same period. In the first half of 2021, the company recorded total revenue of 598 million yuan, and adjusted net profit of 46 million yuan.

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