New Stock News | The digital health and medical service platform HealthRoad has undergone a hearing at the Hong Kong Stock Exchange. It has incurred losses in the past three years.

According to the disclosure by the Hong Kong Stock Exchange on December 11, Health-Link Stock Limited (referred to as: Health-Link) has conducted a hearing through the Hong Kong Stock Exchange, with China International Capital Corporation acting as its exclusive sponsor. According to the prospectus, Health-Link operates a digital health and medical services platform in China. According to Frost & Sullivan data, based on the number of registered individual users on the platform as of December 31, 2023, the company is the fourth largest digital health and medical services platform. Additionally, based on revenue for 2023, Health-Link is also the fifth largest digital health and medical services platform, with a market share of less than 5%. Since 2001, the company has been providing health and medical services to individual users in China through digital platforms. In 2015, it began providing corporate services and digital marketing services to enterprises and institutions. According to Frost & Sullivan data, the Chinese health and wellness market is undergoing digital transformation, with the market share of the digital health and wellness market expected to expand. Data shows that the size of the Chinese digital health and wellness market increased from RMB 179.5 billion in 2018 to RMB 738.6 billion in 2023, with a compound annual growth rate of 32.7% from 2018 to 2023. It is estimated that the market size will grow from RMB 738.6 billion in 2023 to RMB 1,984.4 billion in 2027, with an estimated compound annual growth rate of 28.6% from 2024 to 2027. According to Frost & Sullivan data, it is expected that the market size will further increase to RMB 3,879 billion by 2030. In terms of finances, as of the six months ended June 30, in 2021, 2022, 2023, and 2024, Health-Link's revenues were approximately RMB 431 million, RMB 569 million, RMB 1.244 billion, and RMB 611 million respectively, with losses during the same periods of approximately RMB 155 million, RMB 256 million, RMB 314 million, and RMB 57.275 million respectively. Health-Link pointed out in the prospectus that the net losses generated by the company in 2021, 2022, and 2023, as well as in the six months ended June 30, 2023, and 2024, were mainly due to changes in the book value of redeemable liabilities. In fewer instances, the company incurred operating losses of approximately RMB 66.441 million in 2021. Operating losses were recorded in 2021 because operating expenses exceeded gross profit and other net income. This was mainly due to (i) expenses of approximately RMB 65.5 million related to the granting of employee share rewards; and (ii) promotional expenses of approximately RMB 71.5 million related to our specific health and medical comprehensive service packages. During the historical periods, the majority of the company's net liabilities and current net liabilities were redeemable liabilities generated by the issuance of convertible redeemable preferred shares to several investors. As of December 31 in 2021, 2022, and 2023, and as of June 30, 2024, redeemable liabilities accounted for 84.3%, 84.5%, 82.9%, and 84.1% of the total liabilities, respectively.