Recently, Zhongzhuo Medical Holdings Co., Ltd. (hereinafter referred to as Zhongzhuo Medical) submitted a listing application to the main board of the Hong Kong Stock Exchange, with China International Capital Corporation as the exclusive sponsor. It is worth noting that the company submitted listing applications to the main board of the Hong Kong Stock Exchange on October 29 last year and June 15 this year, both of which are now invalid.
Zhongzhuo Medical is a comprehensive private medical service provider in Hong Kong. its specialists enjoy a high reputation in their respective professional fields, providing specialist medical services, supplemented by a variety of full-time medical services and medical management services.
According to Frost Sullivan, the company ranks sixth among multi-specialist medical center operators in Hong Kong and has a market share of about 1.4% in terms of revenue generated from the provision of specialist services, including medical and surgical-related specialist services, in 2020. In addition, according to the same information, the company ranks fourth among all private multi-specialist medical centre operators in Hong Kong in terms of revenue generated from the provision of medical specialist services.
As of 2021, the company operates three medical centres under the brand name "Zhongzhuo Medical", namely, an integrated flagship medical centre, Zhongzhuo Medical II and a psychiatric centre; and two imaging and diagnostic centres and a laboratory under the subsidiary brand of "Hong Kong Medical Diagnostic Centre", all located in Central, Hong Kong. The company's customers mainly include individuals who seek medical services from the company's experts.
The main services include specialist medical services, including Cardiology, Respiratory system, Gastroenterology, Nephrology, Nephrology, brain Neurology, Psychiatry, Endocrinology and Diabetes, Geriatrics, Oncology, Pediatrics, Rheumatology, Dentistry, Family Medicine and Clinical Microbiology and Infectious Diseases as well as in-patient services in Hong Kong private hospitals.
In addition, there are full-time medical services, including clinical psychological services, speech therapy, nutritional therapy and psychological counselling, as well as imaging, diagnostic and laboratory services in diagnostic centres. The company also provides vaccination services in medical centres and community vaccination centres.
On the financial front, Zhongzhuo's medical income increased from HK $195.7 million for the year ended March 31, 2019 to HK $248.4 million for the year ended March 31, 2020. The increase in revenue was mainly due to an increase in revenue from specialist medical services. Of this total, revenue generated through specialist services increased by HK $40.1 million or 20.9% from HK $192.3 million for the year ended 31 March 2019 to HK $232.4 million for the year ended 31 March 2020.
Revenue increased from HK $248.4 million for the year ended 31 March 2020 to HK $251.4 million for the year ended 31 March 2021. The increase in revenue was mainly due to an increase in revenue from allied health services, partly offset by a decrease in revenue from specialist health services. Revenue from specialist services decreased by HK $14.4 million or 6.2 per cent from HK $232.4 million for the year ended 31 March 2020 to HK $218 million for the year ended 31 March 2021.
The company's earnings increased from HK $121.3 million for the six months ended September 30, 2020 to HK $166 million for the six months ended September 30, 2021.
Based on the characteristics of the aging population, the increasing demand for health care services and the further expansion of Hong Kong's medical market, it is estimated that Hong Kong's total medical expenditure will grow at a compound annual growth rate of about 7.5% from 2020 to 2024, of which, benefiting from the increase in insurance purchases and the government-promoted voluntary health insurance plan, private health care expenditure is expected to grow at a compound annual growth rate of about 7.6% from 2020 to 2024. The relevant companies led by Zhongzhuo Medical are expected to benefit from this development dividend.
However, according to the current market pattern of private medical centers, the competition is decentralized and more fierce. According to Frost Sullivan data, about 2400 private health care service providers in Hong Kong registered with the Department of Health's electronic health record sharing system in 2019. Most of them operate as private medical centers. In 2019, the top 10 private multi-specialist medical center operators accounted for only 18.8% of the market share, of which the leading enterprises accounted for only 4.2% of the market share.
On the whole, the impact listing of Zhongzhuo Medical is to a certain extent based on the choice of improving the company's competitiveness in the industry. After all, with the further improvement of the company's image, brand and reputation, its business operation will also have more development opportunities.