New Stock News | Health product company Genuine Holdings submits second application to Hong Kong Stock Exchange to operate six self-owned brands

According to the disclosure on the Hong Kong Stock Exchange on March 9th, Pure Group Limited (referred to as "Pure Group") has submitted an application for listing to the main board of the Hong Kong Stock Exchange, with Hon Bor Capital Limited as its exclusive sponsor. This is the company's second submission to the Hong Kong Stock Exchange. Company Profile According to the prospectus, the company primarily engages in the development, sales, marketing, and distribution of health and beauty supplements and products in Hong Kong. The company outsources the production of products to suppliers (including manufacturers) and primarily distributes the company's products through Watsons retail outlets in Hong Kong under the company's own brand and third-party brands. According to Frost & Sullivan data, based on the retail value of health and beauty supplements and products, the company had a market share of approximately 1.6% among all international and local health and beauty supplement and product suppliers in Hong Kong in 2024. In the local health and beauty supplement and product market, the company offers a diversified product portfolio catering to the needs of men, women, and children of all ages, focusing on niche markets such as deer-related health supplements, joint and pain relief, and topical pain relief products. According to Frost & Sullivan data, (i) the company ranked first in the retail value of deer-related health supplements and products in Hong Kong in 2024, with a market share of around 29.4%; and (ii) the company's own brand, Yanzhung Xiao, which includes joint and pain relief and topical pain relief products, was one of the top five best-selling joint and pain relief supplements and products in Watsons retail outlets in 2024. Since its establishment in 2011, the company has been actively developing its product portfolio, offering a variety of products to meet the needs of children, adults, and seniors. As of the latest practicable date (February 27, 2026), the company operates (i) a total of six proprietary brands, namely (a) Pure; (b) Yanzhung Xiao; (c) Organicpharm; (d) Riyaotang; (e) Weixingsheng; and (f) Profix; and (ii) a total of six third-party brands, including (among others) (a) iPro+ and (b) Boiron. In addition to its own brand products, the company sells and distributes third-party brand products from suppliers G and supplier K. As such, the company purchases relevant products directly from brand owners and generates revenue through the sale and distribution of products. The directors believe that third-party brand products further enrich the company's product portfolio, allowing the company to better meet the evolving needs of end customers. The company also provides sales promotion services to third-party brand owners or brand owner groups, wherein the company assists brand owners in selling their products through the company's distribution channels (including Watsons) and collects commissions based on the purchase amount or subsequent sales revenue or sales revenue generated by sales promoters through the company's distribution channels. During the historical period, the company provided sales promotion services for third-party brand products under suppliers K, SST Healthy, customer B, Boiron Asia, and Shangdi. During the historical period, the company also generated revenue through providing management and packaging services, where (i) the company provided value-added packaging solutions services according to customer requirements, including packaging, warehousing, and inventory management, and charged service fees; and (ii) the company provided primary customer management and marketing services to third-party brand owners to assist them in launching products through the company's distribution channels, in exchange for a fixed management fee. The company's revenue comes from (i) the sale of the company's own brand and third-party brand health and beauty supplements and products; (ii) providing sales promotion services to third-party brand owners or brand owner groups; and (iii) providing management and packaging services. For the three years ended March 31, 2025, and the six months ended September 30, 2024, and 2025, sales of health and beauty supplements and products accounted for approximately 98.8%, 98.8%, 98.2%, 97.8%, and 98.2% of the company's total revenue, respectively. Financial Information Revenue For the financial years 2023, 2024, 2025, and the six months ended 2026, the company's revenue was approximately HK$43.193 million, HK$110 million, HK$130 million, and HK$52.442 million, respectively. Profit For the financial years 2023, 2024, 2025, and the six months ended 2026, the company's net profit and comprehensive income for the year/period were HK$11.313 million, HK$35.483 million, HK$36.257 million, and HK$0.944 million, respectively. Gross Profit Margin For the financial years 2023, 2024, 2025, and the six months ended 2026, the company's gross profit margin was 81.6%, 78.6%, 75%, and 76.6%, respectively. Industry Overview In the Hong Kong market for health supplements and products, despite the disruption in retail foot traffic due to the outbreak of COVID-19, the nutrition and herbal supplement segment still brought in HK$7.1 billion in revenue in 2020, which increased to HK$7.8 billion in 2024, with a compound annual growth rate of approximately 2.4%. This resilience is attributed to several factors. Firstly, with the outbreak of COVID-19, public health awareness has increased, making daily nutritional supplementation a norm and expanding the consumer base (especially beyond the traditional silver-haired market segment). Secondly, the aging population is increasing per capita consumption of preventive nutritional products (especially those targeting joint, cardiovascular, and cognitive health). In addition, the rapid expansion of cross-border e-commerce platforms has increased the transparency of product variety and prices, maintaining average selling prices while driving sales volume growth. Lastly, the revival of inbound tourism has rejuvenated duty-free shops and sales in downtown retail areas, contributing to the growth in demand that was underserved from 2021 to 2022. Considering the driving factors mentioned above, industry revenue is expected to reach HK$9.7 billion by 2029, with a faster compound annual growth rate of approximately 4.6% between 2025 and 2029. Additionally, it is estimated that traditional Chinese medicines (including but not limited to cordyceps, ginseng, and lingzhi ingredients) account for approximately 38.2% of the retail value of the health supplement and product market in Hong Kong, while non-traditional Chinese medicine products such as NMN, probiotics, vitamins, protein powder, etc., account for 61.8% of the market size. The Hong Kong market for beauty supplements and products recorded sales of HK$2.375 billion in 2020, which increased to HK$2.709 billion in 2024, with a compound annual growth rate of approximately 3.3%. This resilience is supported by several structural factors. Firstly, the vigorous development of social media platforms for video calls and self-portraits has made people more conscious of appearances, leading not only to traditional consumer groups over the age of 35 but also to millennials more commonly consuming collagen drinks, ceramide capsules, and probiotics enzyme powder. Secondly, live streaming commerce and cross-border digital marketplaces can introduce new nutritional and beauty products from Japan, South Korea, and mainland China to the Hong Kong market within weeks, enriching product variety and maintaining high average selling prices. Additionally, after the outbreak of COVID-19, the return of travelers has revitalized offline beauty chain stores and tourism retail outlets, driving retail value growth particularly in 2023 and 2024. Looking ahead, sales in this category are expected to reach HK$3.538 billion by 2029, indicating a compound annual growth rate of 5.5% between 2025 and 2029. Key driving factors include the rise of men's beauty and body sculpting trends, expanding customer base for fat metabolism pills and muscle-building enzyme mixtures; sustained influencer promotion that moves users from external skincare to a combination of external and oral solutions; and innovative products such as peptide ready-to-drink, NMN mixture, and sugar-free gummies that help enrich product variety. In the beauty supplement and product market, estimated contributions to the retail value in 2024 for shaping agents and beauty nutrition compounds were approximately 30.7% and 69.3%, respectively. Board of Directors Information The Board of Directors comprises five directors, including two executive directors and three independent non-executive directors. The Board of Directors is responsible for managing and operating the company's business and has general powers to manage and operate the company's business. Equity Structure Mr. Zhang Yunyu, the ultimate controlling shareholder, is an executive director of the company, chairman of the Board, and chief executive officer. Intermediary Team Sponsor: Hon Bor Capital Limited; Legal Advisors: Han Kun Law Firm, , , Han Kun Law Firm, Kand Ming Law Firm; Sponsor and Compiled Legal Advisors: Junhe Law Firm; Auditors and Reporting Accountants: Rich Macro Maize Certified Public Accountants Limited; Industry Consultants: Frost & Sullivan Limited; Tax Advisors: Zeng Zheng Taxation Limited.