Futu News, May 1, China's leading technology platform for insurance and health services$Water drop Company (WDH.US) $Hot subscription has begun and is expected to be listed on the New York Stock Exchange on May 7. the IPO underwriters include Goldman Sachs, Morgan Stanley, Bank of America Securities, Agricultural Bank of China International, China Merchants Securities (Hong Kong), Haitong International, Fortuo Securities and so on.

According to the latest prospectus, Shuidi plans to issue 30 million American depositary shares in this IPO, (ADS), corresponding to 10 Class A common shares per ADS, with an issue range of $10 to $12 per ADS.

The cornerstone investors of Shuidi include: Meituan founder Wang Huiwen's family trust fund Kevin Sunny invested US $30 million, Hopu Capital invested US $80 million and Boyu Capital invested US $100m.

Leading market position, the largest independent insurance technology platform in China

Founded in 2016, Shuidi is China's leading technology platform for insurance and health services. Through medical fund-raising, insurance technology and health service platforms, the company has built a huge network of insurance protection and health services.

The company's "Water drop Protection" is the largest independent third-party insurance platform in China.. As of December 31, 2020, Widi Insurance has partnered with 62 insurance companies to provide 200 health and life insurance products online, most of which are jointly customized insurance products. The total number of service insurance users is about 79.4 million, and the total number of insurance policies paid is 30.7 million. In 2020, the company will achieve a first-year premium of more than 14.4 billion yuan ((FYP)).

In terms of fund-raising in 2020, "Shuidi fundraising" is the largest medical fund-raising platform in China.. By the end of 2020, more than 340 million people had donated more than 37 billion yuan to more than 1.7 million patients through drip financing. Drip fundraising is 0 service charge for fund-raising patients, and the prospectus also shows that the drip fundraising business does not generate any income.

The business model is ecological on its own, and the traffic structure is constantly optimized.

Shuidi has established a comprehensive business model of "insurance + medical health". At the same time, with its advantages in the fields of data insight, big data analysis and artificial intelligence, Shuidi has developed a system that can effectively convert traffic.

The company obtains users through "drip financing", "drip Mutual" (which ceased operation in March 2021) and third-party flow channels, and provides customized insurance and medical solutions for these users, through its "Waterdrop Insurance" online channels, generate revenue from the sale of insurance products underwritten by insurance companies.

It is worth noting thatThe proportion of third-party traffic channels, natural traffic and repurchases has increased rapidly in recent years.In 2020, the proportion of third-party traffic channels, natural flow and repurchase increased to 83.4%, reflecting the optimization of the company's traffic structure.

The market opportunity is huge, and the industry is facing digital transformation.

According to the iResearch report,In terms of total premiums in 2019, China's insurance market ranks second in the world.However, there is still a large gap in insurance penetration between developed countries and developed countries, and there is great potential for market growth. It is estimated that by 2024, the total premium in China's insurance market will reach 7.8 trillion yuan. Among them, life insurance and health insurance are expected to reach 6.1 trillion yuan, an average annual compound growth rate of 14.5% compared with 2019.

The insurance industry is facing the trend of digital transformation. According to the iResearch report, the online life insurance and health insurance market is expected to reach 592 billion yuan in 2024, with an average annual compound growth rate of 26.1% compared with 2019. During this period, online health insurance premiums will maintain an average annual compound annual growth rate of 53.7% to 202 billion yuan in 2024.

Capital favored, luxurious shareholder lineup

Since its establishment in 2016, Shuidi has received investment from more than a dozen well-known institutions, including Tencent, Meituan, IDG Capital, Lighting Fund, ZhenFund, Lanchi Venture Capital, Innovation works, Boyu Capital, CICC Capital and Swiss Reinsurance Group.

According to the prospectus, the company's core management holds the largest share in terms of ownership structure, with founder and CEO Shen Peng, co-founders Yang Guang and Hu Yao holding 26.4%, Tencent 22.1%, the largest institutional shareholder, and Swiss Reinsurance 5.7%.

In terms of fund-raising purposes, 50 per cent of the funds raised by IPO will be used to expand health services and health insurance business; 30 per cent will be invested in technology research and development; and the remaining funds will be used for general corporate purposes, including working capital needs and potential strategic investments and acquisitions.