IPO Update | Zhiyun Health begins its offering today, with an expected listing on July 6

Futu Information reported on June 23 that this Thursday$CLOUDR (09955.HK)$announced its initial public offering from June 23 to June 28. The company plans to issue 19 million shares, including 1.9 million shares for public offering, and 17.1 million shares for international offering. The issue price is HKD 30.50 per share, with a minimum lot size of 100 shares, expecting to be listed on July 6.

The prospectus shows that,Zhiyun Health provides medical supplies and SaaS products to hospitals and pharmacies, digital marketing services to pharmaceutical companies, and online consultations and prescription issuance to patients, all centered around chronic disease management.Zhiyun Health expects to continue generating most of its revenue in the near future by selling medical supplies to hospitals and pharmacies.

By providing solutions for all major participants in the healthcare value chain—including hospitals, pharmacies, pharmaceutical companies, patients, and doctors—Zhiyun Health aims to lead China’s digital chronic disease management market. According to a Frost & Sullivan report, based on the number of SaaS deployments in Chinese hospitals and pharmacies as of December 31, 2021, and the volume of online prescriptions issued through Zhiyun Health's services in 2021,Zhiyun Health is China’s largest provider of digital chronic disease management solutions.。

Zhiyun Health offers in-hospital solutions, pharmacy solutions, and personal chronic disease management solutions.In-hospital solutionsinclude the sale of medical devices, consumables, and pharmaceuticals, hospital SaaS, and digital marketing services for pharmaceutical companies, primarily selling medical devices and consumables.Pharmacy SolutionsIncluding the sale of medical devices, consumables, pharmaceuticals, and other categories of products, as well as Zhiyun Health's pharmacy SaaS. The medical supplies sold are mainly related to chronic disease management, while the pharmacy SaaS product enables pharmacies to have the ability to issue prescriptions and dispense medication online.Personal Chronic Disease Management SolutionsConnecting doctors with patients to enable out-of-hospital consultations and prescription issuance for chronic disease management.

Financial ConditionIn terms of financial performance, the company’s total revenue for 2019-2021 was RMB 524 million, RMB 839 million, and RMB 1.757 billion respectively, with a compound annual growth rate of 83.02% from 2019 to 2021; net losses for the same period were RMB 569 million, RMB 2.751 billion, and RMB 4.021 billion respectively.

In the industry,Driven by favorable policies and continuous technological advancements, different sectors of the healthcare industry have seen a clear acceleration in digitalization trends, leading to rapid growth in China’s digital health and wellness market. It is expected that by 2025, the size of China's entire digital health and wellness market will reach RMB 1,511.6 billion, with a compound annual growth rate of 37.5% from 2020 to 2025, and further grow to RMB 4,165.2 billion by 2030, with a compound annual growth rate of 22.5% from 2025 to 2030.

Cornerstone InvestorIn terms of cornerstone investors, they have agreed, subject to certain conditions, to subscribe or cause their designated entities to subscribe for a total amount of approximately HKD 353 million at the offer price. The cornerstone investors include Sanofi Foreign Participations B.V., Harvest International Premium Value (Secondary Market) Fund SPC, Yangtze River (Hong Kong) Co., Ltd., and Tasly International Capital Limited.

Use of ProceedsIn terms of proceeds, the company expects to receive net proceeds of approximately HKD 482 million. The company intends to use the net proceeds from the share offering for the following purposes: about 60% for business expansion; about 25% for enhancing medical knowledge and technical capabilities; about 5% for strategic partnerships, investments, and acquisitions; and about 10% for working capital and general corporate purposes.

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