On September 28, the Hong Kong Stock Exchange disclosed the prospectus submitted by Jingdong health. According to the announcement, as a subsidiary of Jingdong group, Jingdong group plans to spin off Jingdong health and list on the main board of the stock exchange of Hong Kong. The completion time of the specific split listing will depend on factors such as market conditions.
Compared with other bats Internet Medical platforms, JD healths profitability is superior: from 2017 to 2019, JDs health revenue was 5.6 billion yuan, 8.2 billion yuan and 10.8 billion yuan respectively. In the first half of 2020, the income of Jingdong health reached 8.8 billion yuan, up 76% year on year. Excluding the changes in fair value and non recurring profit and loss, the net profit margin reached 3.0% and 3.2% in 2018 and 2019, and 4.2% in the first half of 2020.
However, the huge revenue depends heavily on the sale of self-employed medicine and health products, commonly known as selling drugs..
Jingdong health has been operating independently since 2014, becoming the third Unicorn hatched by Jingdong group after Jingdong Logistics and Jingdong several branches.
According to frost Sullivans report, JD health is Chinas largest online health platform and the largest online retail pharmacy in terms of revenue in 2019.
In terms of equity structure, the largest shareholder of JD health before IPO was Jingdong group, with a shareholding ratio of 81.04%. It is expected that Jingdong group will still hold no less than 50% equity after IPO.
Since the rise of the Internet, Internet medicine has been given great expectations, and an epidemic in the first half of the year has become a catalyst for its rapid development.
Chen Li Teng, an analysis of life service e-commerce of e-commerce research center of e-commerce, pointed out that the internet medical (online medical) field is the online medical service based on the Internet as carrier and technical means, including online registration, medical information query, electronic archives, online consultation, electronic prescription, remote consultation and other forms, while the broad sense of internet medical care covers the whole medical industry Chain, involving medical treatment, medicine, medical insurance and other links.
Throughout the Internet industry, there are not a few giants entering the medical and health field, and bat is the first to lay out this track. Tencent set foot in medical services by way of investment in 2014, and made medical business relying on its social advantages; Alibaba made strategic investment in CITIC in the 21st century in 2014, then renamed Ali health and officially opened the medical layout; Baidu also established the medical business department very early, and then vigorously developed medical AI.
Jingdong also started from the layout of non health care medical e-commerce retail in 2014, and got the first batch of Internet hospital license in 2017. Until now, Jingdong health has formed full-scale pharmaceutical retail including B2B, B2C and o2o.
From the performance point of view, JD healths business income in 2019 will reach 10.8 billion yuan, and it has achieved profit. However, the revenue of Ali health in fiscal year 2020 (as of March 31, 2020) was RMB 9.6 billion, with a loss of 15.7 million; the revenue of Ping an good doctor in 2019 was 5.065 billion yuan, with a loss of 1.83 billion yuan. In contrast, Jingdong health has already realized overtaking on the curve.
The main income still depends on selling drugs
It is worth mentioning that, despite the large scale of income, most of the income source supporting Jingdong health actually comes from selling medicine.
According to the prospectus, from 2017 to 2019, the sales revenue of medicine and health products were 4.907 billion yuan, 7.255 billion yuan and 9.435 billion yuan respectively, accounting for more than 87% of the total revenue.
It is reported that Jingdong healths online retail pharmacy business operates through three modes: self operated, online platform and omni channel layout. The self operated mode mainly refers to Jingdong pharmacy; the online platform mode mainly refers to the settlement of third-party businesses. As of June 30, 2020, Jingdong healths online e-commerce platform has more than 9000 third-party merchants, and the online retail platform has more than 10 million kinds of goods (SKUs). There are 11 special drug warehouses and more than 230 non drug warehouses in the whole country. The omni channel layout is to meet the needs of customers As of June 2020, Jingdong health can provide 7 u00d7 24 one-day, next day and 30 minute service for users in 200 cities across the country.
According to the prospectus, the revenue of Jingdong health online platform, advertising and other services from 2017 to 2019 were 646 million yuan, 914 million yuan and 1.407 billion yuan respectively, accounting for 11.6%, 11.2% and 13% of the total revenue respectively. In the first half of 2020, the service revenue will reach 1.084 billion yuan, accounting for 12.4%.