On March 27, 2024, Shulan Health Management Co., Ltd. (hereinafter referred to as “Shulan Healthcare”) from Hangzhou, Zhejiang submitted a prospectus to the Hong Kong Stock Exchange to be listed on the Hong Kong Main Board. This is another application after its submission expired on August 28, 2023.
Link to Shulan Medical Prospectus:
Main business
As a leading social medical group in China integrating health care services, medical research, and medical education, Shulan Medical owns and operates 3 social comprehensive medical institutions, and has provided hospital management services to 17 partner hospitals in China (as of March 31, 2023). As a comprehensive medical group, Shulan Medical also provides a number of health-care related services, including digital medical platform services, medical testing services, clinical trial services, and supply chain services.
According to Frost & Sullivan data, in 2022, Shulan Medical is the largest social medical institution in East China in terms of income; according to the relative weight of each disease group in 2022 (RW for short, it reflects the difficulty of diagnosing and treating specific disease groups, the higher the value, the more difficult it is to diagnose and treat. RW of 10 or above usually indicates a difficult and serious illness) The total number of discharged patients in this disease group of 10 or above is 10. Shulan Medical ranked third among all social and public medical institutions in Zhejiang Province, and number one among all social medical institutions in Zhejiang Province.
Health care services
Shulan Medical provides comprehensive health care services at its own hospitals, including multidisciplinary diagnosis, treatment, and rehabilitation services. As of December 31, 2023, Shulan Medical currently owns and operates 3 social comprehensive medical institutions:
Shulan (Hangzhou) Hospital has 1,000 beds. The Liangzhu campus under construction has 2,000 planned beds and 1,479 full-time employees, including more than 1,282 medical professionals, 46 clinical departments, and 13 medical technology departments. The hospital was certified by JCI in China in 2017, and also received a grade 3 A rating from the Zhejiang Provincial Health Commission in 2021.
Shulan (Anji) Hospital has opened 200 beds. It is estimated that after full completion, it will have a total of 807 beds and 381 full-time employees, of which more than 291 are medical professionals.
Shulan (Quzhou) Hospital has 244 beds and is expected to have a total of 800 beds after completion. It has 456 full time employees, including 370 medical professionals.
Hospital management services
Shulan Medical's hospital management service business is generally divided into two categories: comprehensive management service model and subject management service model. As of December 31, 2023, Shulan Medical has provided hospital management services to 17 hospitals. Of these, 5 hospitals have adopted a comprehensive management service model, and 12 hospitals have adopted a subject management service model. Cooperative hospitals are spread across many provinces and municipalities directly under the Central Government in China, including Fujian, Chongqing, Henan, Shandong, Guangdong, Yunnan, Anhui, Zhejiang, and Inner Mongolia Autonomous Region.
Under the integrated management service model, the company provides extensive assistance to partner hospitals in various subject areas and their overall management to help partner hospitals comprehensively improve the quality and management efficiency of health care services under this model.
Under the discipline management service model, the company focuses on improving medical expertise in one or more clinical disciplines in partner hospitals. By focusing on the development of selected clinical disciplines, we aim to help partner hospitals achieve significant growth in related disciplines in a relatively short period of time.
Health and medical related services
The digital medical platform service provides patients and doctors with convenient online access to the company's medical resources, including online consultation and follow-up, electronic prescriptions, tests, and other telemedicine services.
Medical testing services. The company has advanced technology, equipment and proprietary technology to carry out medical tests, and has a wide range of services, including diagnosing infectious diseases, rare diseases and various other health problems. As of December 31, 2023, the company's diagnostic testing catalogue covers a variety of categories, including blood transfusion, immunization, pathology and other clinical tests.
Clinical trial services. The company has a clinical trial center, capable of conducting phase I to phase IV clinical trials of drugs, medical devices and diagnostic reagents, as well as trials initiated by researchers. In 2020, the company's clinical trial center was certified by the State Drug Administration as a national drug clinical trial institution. In the past performance period, Shulan Medical has initiated clinical trials for 129 drugs and tests for 28 medical devices. As of December 31, 2023, the company has 77 ongoing clinical trials of research drugs and 14 ongoing clinical trials of medical devices.
Supply chain services to manage the procurement of pharmaceuticals, medical devices and consumables. By coordinating and integrating the procurement requirements of the company's own hospitals, it is possible to negotiate lower purchase prices and preferential payment terms while managing the quality of supply. The company operates a pharmacy to provide medical supplies to individual and business customers.
Shareholder structure
According to the prospectus, Shulan Medical's shareholder structure before listing,
Brothers Zheng Jie and Zheng Jun hold 46.91% of the shares through Shulan investments which each own 60% and 40%;
Mr. Zheng Jun directly holds 0.48% of the shares;
Mr. Zheng Jie, Mr. Zheng Jun, Mr. Xu Dilong, Dr. Xu Meifang, Ms. Du Jianping, and Mr. Li Tanwei passed Ningbo Haijun and held 1.38% of the shares;
The employee incentive platforms Ningbo Shujie, Ningbo Shujun, Ningbo Lanjun, and Ningbo Jiexiao hold 0.85%, 0.85%, and 0.43% of the shares respectively;
Singapore GIC holds 13.93% of shares through Cliff Investment;
Ms. Ge Feiyu holds 5.29% of the shares;
China Life Insurance (601628.SH, 02628.HK) holds 4.75% of the shares through the China Life Insurance Health Fund;
Mr. Zhang Li (GP) holds 3.19% of the shares through Mingshang Investment;
Dr. Lu Zhen and his son Mr. Lu Runbang (GP) and Ms. Shi Youyun held 3.1% of the shares through Juwang Investment Network;
Yida Fund (GP) holds 2.87% and 0.53% of shares respectively through Jiangsu Yida and Talent Fund;
Qiming Rongxin holds 2.21% of the shares;
Sequoia Hanchen holds 2.19% of the shares;
The People's Insurance Fund holds 1.7% of the shares;
Healthcare investment, holding 1.59% of the shares;
Jin Yiming, Zhuhai, holds 1.25% of the shares;
Dentong Capital (GP) holds 0.9% and 0.31% of shares through Dexin Investment and Dentong Investment, respectively;
China Galaxy (601881.SH, 06881.HK) holds 0.64% of shares through Galaxy Yuanhui;
Hongjun Investment holds 0.63% of the shares;
Mr. Cui Qi holds 0.62% of the shares;
Yuanhai Mingsheng holds 0.62% of the shares;
PricewaterhouseCoopers holds 0.46% of the shares;
Shanghai Renan holds 0.43% of the shares;
Ms. Cao Xiaochun holds 0.4% of the shares;
Mr. Zhang Chuan holds 0.32% of the shares;
Juhong Investment holds 0.21% of the shares;
Mr. Cheng Huamin holds 0.1% of the shares;
Directors and Executives
The board of directors of Shulan Medical consists of 9 directors, including 1 executive director (Mr. Zheng Jie), 5 non-executive directors (Mr. Zheng Jun, Mr. Wu Zhangmu, Dr. Shou Zhang Fei, Mr. Ye Xubiao, Mr. Xu Dilong), and 3 independent non-executive directors (Dr. Zhu Yan, Dr. Tang Jinling, and Dr. Ma Xiaofang).
3 members of the Supervisory Board (Dr. Lu Zhen, Mr. Huang Yu, Ms. Yuan Jingjing).
In addition to the executive director, executives include Chief Financial Officer Mr. Qi Zhongbin and Deputy General Manager Dr. Xu Meifang.
Company performance
According to financial data, in the past 2021, 2022 and 2023, Shulan Medical's revenue was RMB 1,548 billion, RMB 1,778 billion and RMB 1,884 billion, respectively. The corresponding net profit was RMB -82.289 million, -11.081 million and -17.252 million yuan, respectively. The corresponding adjusted net profit was RMB 21.77 million, 6.304 million and RMB 82.777 million, respectively.
Intermediary team
Shulan Healthcare's intermediary team for this IPO mainly includes: CICC and CITIC Securities as co-sponsors; PricewaterhouseCoopers as its auditors; King & Co., Ltd. and Clyde as its Chinese lawyers and Hong Kong lawyers respectively; Jingtian Gongcheng and Shengde as its Hong Kong lawyers; Dai Deliang as its property valuer; and Frost Sullivan as its industry consultant.