New Stock News | Rongtai Pharmaceutical submits a second application to the Hong Kong Stock Exchange, becoming China's third-largest provider of digital marketing and supply chain services for the outpatient pharmaceutical market.

According to the Hong Kong Exchange's disclosure on May 22nd, Guangdong Rongtai Pharmaceutical Co., Ltd. (Rongtai Pharmaceutical) has submitted an application for listing on the main board of the Hong Kong Stock Exchange, with CITIC SEC as the exclusive sponsor. The company had previously submitted a listing application to the Hong Kong Stock Exchange on September 26, 2025. Company Overview According to the prospectus, Rongtai Pharmaceutical is a leading provider of digital marketing and supply chain services in China's primary outpatient drug market. Rongtai Pharmaceutical engages in online and offline retail and wholesale of pharmaceutical products, with revenue mainly derived from (i) selling to individual customers through third-party e-commerce platforms and online stores; (ii) selling to grassroots terminals through regional sales partners and online stores; and (iii) selling drugs to chain pharmacies. According to data from Frost & Sullivan, based on 2025 revenue, Rongtai Pharmaceutical is the third-largest provider of digital marketing and supply chain services in China's outpatient pharmaceutical market. Selling through third-party e-commerce platforms (S2B2C) refers to the company selling pharmaceutical products to individual customers through third-party e-commerce platforms. Rongtai Pharmaceutical connects upstream pharmaceutical companies with the best e-commerce sales resources. After purchasing pharmaceutical products from upstream pharmaceutical companies or their authorized distributors, Rongtai Pharmaceutical sells the products to individual customers through B2C and O2O e-commerce platforms like JD HEALTH, ALI HEALTH, Meituan Medicine, Dingdang Kuaishao, and Quanyuantang. Selling through Rongtai Pharmaceutical's online stores (S2C) refers to the company selling pharmaceutical products to individual customers through its online stores. In addition to selling through third-party e-commerce platforms, Rongtai Pharmaceutical has established its own sales channel - Yikangsi Drugstore, a retail pharmacy brand that directly serves individual customers. Yikangsi Drugstore is an additional channel to promote pharmaceutical products. Rongtai Pharmaceutical has operated online stores (mainly Yikangsi Drugstore) on major B2C and O2O e-commerce platforms like ALI HEALTH and Meituan Medicine in past periods, selling pharmaceutical products directly to individual customers through these Yikangsi Drugstores. By integrating prescription dispensing, over-the-counter drugs, and medical health products on a single platform, Rongtai Pharmaceutical simplifies the purchasing process to meet the growing convenience needs of individual customers. The company has also established a digital platform that integrates online medical services with commercial insurance companies and implemented patient education programs and medication adherence management programs. These programs cover major treatment areas such as cardiovascular diseases, mental illnesses, tumors, skin diseases, flu, and common colds. Financial Data Revenue In the fiscal years 2023, 2024, and 2025, the company achieved revenues of approximately RMB 2.916 billion, RMB 2.875 billion, and RMB 3.388 billion, respectively. Gross Profit Margin In the fiscal years 2023, 2024, and 2025, the company's gross profit margins were 6.7%, 6%, and 6.8%, respectively. Net Profit In the fiscal years 2023, 2024, and 2025, the company recorded net profits of approximately RMB 45.717 million, RMB 3.741 million, and RMB 36.591 million, respectively. Industry Overview The prospectus mentions that due to favorable government policies and increasing demand for medications, the size of China's outpatient pharmaceutical market has grown rapidly in recent years, gradually increasing its share of the overall pharmaceutical market size. From 2020 to 2025, the market size increased from RMB 509.2 billion to RMB 692.6 billion, with a forecasted market size of RMB 1.0224 trillion in 2030. The compound annual growth rate from 2020 to 2025 was 6.3%, while from 2025 to 2030, it is expected to be 8.1%. The outpatient pharmaceutical market in China can be divided into over-the-counter drugs (OTC) and prescription drugs. In 2025, the total size of China's outpatient pharmaceutical market is expected to reach RMB 692.6 billion, with RMB 262.7 billion from the OTC drug market and RMB 430 billion from the prescription drug market. By 2030, the OTC market is expected to reach RMB 378.9 billion, with a compound annual growth rate of 7.6% from 2024 to 2030, while the prescription drug market will reach RMB 643.5 billion, with a compound annual growth rate of 8.4% from 2025 to 2030. OTC drugs are expected to grow at a slower pace compared to prescription drugs, mainly due to OTC drugs being a core part of China's outpatient pharmaceutical market, with high market maturity and a large existing customer base. Prescription drugs, on the other hand, are experiencing faster growth due to policy support for hospital prescription outflow and the continued expansion of retail and online pharmacy channels. In recent years, the market size of China's outpatient digital marketing and supply chain services has grown rapidly. From 2020 to 2025, the market size increased from RMB 175.4 billion to RMB 256.6 billion, with an expected size of RMB 432.1 billion in 2030. The compound annual growth rate from 2020 to 2025 was 7.9%, while from 2025 to 2030, it is expected to be 11.0%. Board of Directors Information The board of directors consists of nine directors, including four executive directors, two non-executive directors, and three independent non-executive directors. Equity Structure As of the last practicable date, Mr. Chen Changqing collectively controls approximately 46.31% of the company's issued share capital, including (i) his direct ownership of approximately 21.83% of the issued share capital and (ii) Guangzhou Changfeng's ownership of approximately 24.48% of the issued share capital, with Mr. Chen controlling the company as the sole general partner. Therefore, the company's controlling shareholders include Mr. Chen and Guangzhou Changfeng. As of the last practicable date, Guangzhou Changfeng, approximately 3.03%, is owned by Mr. Chen as the sole general partner. As of the last practicable date, Tianjin Haida holds indirect interests in 1,036,251 shares owned by Guangzhou Zhengda, Taizhou Sida, Lishui Tongda, Ningbo Xianda, Hangzhou Haida, and Khorgos Dadao, representing approximately 9.84% of the total issued share capital of the company. Intermediary Team Exclusive Sponsor: CITIC SEC (Hong Kong) Limited Company Legal Advisors: Jia Yuan Law Firm, Unity Law Firm Exclusive Sponsor Legal Advisors: Jingtian & Gongcheng Law Firm, Jingtian & Gongcheng Law Firm (Beijing) Auditor and Reporting Accountant: Ernst & Young Industry Consultant: Frost & Sullivan (Beijing) Consulting Co., Ltd. Shanghai Branch Compliance Consultant: Hao De Financing Limited