US Stock IPO Encyclopedia | Wheelchair manufacturer Zhongjin Medical will be listed on NASDAQ at a price of $8 per share

Futu News reported on March 28 that Zhongjin Medical once again submitted an updated prospectus to the U.S. Securities and Exchange Commission on March 21 to be listed on the NASDAQ. The stock code is ZJYL. It is expected to be listed on March 28.

Zhongjin Medical announced today that its IPO price is $8. It plans to issue 1 million shares and raise $8 million, excluding underwriter discounts and issuance fees. In addition, according to the over-allotment rights granted by the company to the underwriter, the underwriter can subscribe for up to 150,000 additional shares of common stock at the public offering price within 45 days of the completion of the IPO.

Company Overview

Changzhou Zhongjin Medical Holdings Co., Ltd. began designing and manufacturing wheelchairs and wheelchair components in 2006. At that time, its main products were manual wheelchairs, and sales of electric wheelchairs only began in 2018. In the fiscal year ending September 30, 2022, and the fiscal year 2021, electric wheelchair revenue accounted for 0.4% and 1% of total revenue, respectively.

The company's main products include wheelchairs, wheelchair parts, and lifestyle aids. For the fiscal year ending September 30, 2022, and the fiscal year 2021, the company's wheelchair product revenue was $15.6223 million and $18.2055 million, respectively, accounting for 81.4% and 87.7% of total revenue, respectively.

Photo source: Prospectus

Wheelchair Market Prospects

According to the latest data released by the World Bank, the global population aged 65 and over has increased from 0.6254 billion in 2016 to 0.698 billion, with a compound annual growth rate of 3.7%. This figure will continue to grow in the future, and demand for medical assistive devices (such as wheelchairs) will also increase.

According to the Frost & Sullivan report, wheelchair sales in 2020 rose from 4.07 billion US dollars in 2016 to 7.15 billion US dollars, with a compound annual growth rate of 16.6%. In the context of an aging population, this growth trend will continue. It is expected that by the end of 2025, wheelchair sales will reach 13.34 billion US dollars, with a compound growth rate of 14.1% from 2021 to 2025.

Photo source: Prospectus

Major Shareholders

According to the prospectus, prior to listing, Zhongjin Medical's controlling shareholder was Wang Erqi, with a shareholding ratio of 87.44%, and Gorgeous Enterprises held 8.59% of the shares.

Photo source: Prospectus

Financial Overview

As of September 30, the total revenue of COSCO Medical was $19.191 million and $20.764 million, respectively, and net income was $2.707 million and $2.632 million, respectively.

Photo source: Prospectus

Use of Proceeds

The company plans to use the proceeds from this offering mainly for:

1. R&D activities, including expanding the R&D team, improving the engineering design of existing products, and developing new products

2. Promotion and marketing activities, including the development, operation, and marketing of the company's online platform

3. Expansion of production capacity, including expanding and upgrading production lines and facilities

4. Acquisition of upstream and downstream companies that produce wheelchairs and assistive living products, including parts manufacturers

5. General corporate use.

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