Hong Kong, November 29, 2024 /PR Newswire/ -- Asia Vets Future Limited (NASDAQ: AIFU) is a leading company focusing on insurance agency and claims services. Recently, the company has been gradually promoting its transformation towards intelligence and diversification, aiming to seize potential growth opportunities in the fields of AI insurance and medical health. The recent restructuring of quality assets and strategic cooperation with Baomi Group (NASDAQ: BGM) is expected to create a second curve of performance growth for the company.

1. Restructuring quality assets to create a smarter future.

AIFU is recently restructuring its core assets, involving an amount of 0.14 billion USD: Rongshu Intelligent Technology (Peking) Co., Ltd. and Shenzhen Xinbao Investment Management Co., Ltd.

This is not a simple 'sale' transaction; the restructuring of core assets involves the Duxiaobao AI insurance platform, which provides intelligent solutions for the insurance market through AI and big data. AIFU exchanged these assets for a 72% stake in Baomi Group (BGM), becoming the controlling shareholder of Baomi Group. This transaction not only significantly enhances the market cap of Baomi Group but also opens new space for the future development of Asia Vets Future.

Focus points of asset restructuring:

1) Business growth potential: The "Duxiaobao" AI insurance platform has a strong technical barrier (Baidu's big data platform technology) and market potential (AIFU's insurance brokerage platform), which is expected to bring significant performance growth to Baomei Group in the coming years. AIFU continues to control the future development of Duxiaobao by holding shares in BGM;

2) Undervalued: Baomei Group currently has a market cap of only 52 million USD, but the market space for its new business far exceeds the current valuation. AIFU, as a major shareholder of BGM, will enjoy the dividends from BGM's business growth;

3) Dual business synergy: As a leading company in the global pharmaceutical industry, Asia Vets strengthens the layout in AI insurance and the big health field through deep cooperation with Baomei Group, and is expected to become a leader in these two major industries in the future.

2. Bomei Group: From a market cap of tens of millions to a potential leader in AI insurance.

• Technical advantage: Utilizing Duxiaobao's insurance AI platform and Baidu's big data capabilities to provide personalized insurance customization services for the market. BGM is expected to seize the initiative in the transformation of the AI + insurance market.
• Market opportunity: The global AI insurance industry is on the brink of explosion, and BGM has captured a key moment.
• Industry trend: Actively adapting to the "medicine + insurance" model, there are currently 0.4 billion people with diseases in our country, with annual medical expenses accounting for 60% of total costs, yet related premiums only account for 5% of health insurance, indicating a significant protection gap. Data shows that from 2012 to 2022, the annual compound growth rate of commercial health insurance in our country reached 25.93%, far exceeding the average growth rate of the insurance industry, demonstrating enormous development potential. The successful cases of CVS's acquisition of Aetna and the integration of UnitedHealth Group and OptumRx confirm the important value of "medicine and insurance cooperation" in optimizing costs, innovating supply, and data sharing.

Currently, BGM's market cap has not been fully reflected in the secondary market. If the AI insurance business expands rapidly, BGM's market cap and stock price are likely to undergo significant revaluation.

3. AIFU is undervalued.

As of December 31, 2023, AIFU's total revenue was 3.198 billion USD, a year-on-year increase of 14.98%; net income was 0.289 billion USD, a year-on-year increase of 237.25%. AIFU, as the largest insurance brokerage platform in China, has a price-to-earnings ratio PE (TTM) of only 3.5 times. In comparison, pru's operating income was 11.9 billion USD, a year-on-year increase of 143%; net income was 1.712 billion USD, a year-on-year increase of 271.72%. Prudential financial's operating income was 53.979 billion USD, a year-on-year decrease of 5.10%; net income was 2.508 billion USD, a year-on-year increase of 249%. It can be seen that AIFU has significant growth potential for future development.

Comparing AIFU (approximately $76 million market cap) with pru (PUK, approximately $21.7 billion market cap) and prudential financial (PRU, approximately $46.1 billion market cap), pru and prudential are primarily focused on traditional insurance products, while AIFU is poised to revolutionize the insurance industry's operating model through AI-driven solutions, supported by baidu's big data, effectively lowering costs, expanding market share, and improving customer satisfaction.

4. The layout of the medical and big health industry drives the valuation upward.

AIFU not only focuses on AI insurance business but also vigorously expands into the medical and big health field, seizing new opportunities arising from global aging.

• Population aging: Increased elderly population = Growth in demand for insurance and big health business.
• AI + health management: AIFU plans to provide customized insurance products and services to clients through AI technology.

AIFU has achieved a strong alliance in the two major fields of AI insurance and big health through its strategic restructuring with BGM, and it is expected to become an industry leader. Whether it is BGM's valuation potential or AIFU's business expansion, this trade provides investors with a unique opportunity. The dual drive of AI insurance and medical big health will become the cornerstone of the company's future development.