Yiyang Tongrentang Co., Ltd.

Date of Prospectus: March 20, 2026

Yiyang Tongrentang IPO: In-Depth Analysis, Growth Drivers, and What Investors Need to Know

Yiyang Tongrentang is launching its highly anticipated initial public offering (IPO) on the Main Board of the Hong Kong Stock Exchange. This article provides a detailed, data-driven breakdown of the offer structure, financial health, growth prospects, risk factors, and listing outlook for investors, based exclusively on officially disclosed information. All figures, timelines, and company insights reflect the most current information as of the prospectus date.

IPO Snapshot: Key Offer Terms and Structure

Yiyang Tongrentang is offering its H Shares under the stock code 2667 on the Hong Kong Stock Exchange. The IPO features:

• Offer Price Range: HK\$7.30 to HK\$8.30 per H Share
• Number of Offer Shares: 108,153,500 shares (subject to over-allotment)
• Post-IPO Outstanding Shares: 465,362,049 shares (assuming no exercise of over-allotment option)
• Offer Size: Initially 23.24% of enlarged issued share capital
• Over-allotment Option: Up to 15% of initial offer (16,223,000 additional H Shares)
• Market Capitalization (Post-IPO): HK\$3,397.14 million – HK\$3,862.51 million
• Unaudited Pro Forma Adjusted Net Tangible Assets Per Share: HK\$2.17 – HK\$2.40
• IPO Symbol: 2667

Placement Breakdown:

• 90% International Offering
• 10% Hong Kong Public Offering (subject to reallocation and over-allotment)

Use of Proceeds: Focused on Growth and Expansion

Yiyang Tongrentang expects to raise significant capital, with estimated total listing expenses (at mid-point offer price, excluding greenshoe) of approximately RMB64.1 million (HK\$72.6 million), including underwriting and professional fees. The company’s use of proceeds is geared towards:

• Expansion of core business operations
• Potential M&A and strategic investments
• Working capital and general corporate purposes

This allocation underscores a growth-driven strategy rather than deleveraging, with no significant debt repayment highlighted.

Oversubscription and Subscription Metrics

As of the prospectus date, the final subscription levels and oversubscription rates for both the retail and institutional tranches were not disclosed. Any reallocation between the public and institutional tranches will be communicated on the official websites if necessary.

Dividend Policy: Flexible, Not Guaranteed

Yiyang Tongrentang does not guarantee dividend payments following the IPO. The declaration of dividends will be subject to board discretion, business and financial performance, capital requirements, and regulatory considerations. The company cautions that there may not be sufficient profits for future distributions and no explicit payout ratio or timetable is committed.

IPO Share Allocation: Public, Institutional, and Cornerstone Tranches

The IPO is allocated between the Hong Kong Public Offering (10%) and the International Offering (90%). The Over-allotment Option allows for up to an additional 15% of shares to be issued in the event of excess demand. No employee or shareholder-specific allocation is highlighted.

Cornerstone and Institutional Investors: Commitment and Implications

Cornerstone Investors:

• Airport Technology Capital
• Aurora SF

Together, these cornerstone investors are subscribing for up to HK\$389.3 million worth of H Shares, representing up to 43.37% of the offer (without greenshoe) at the maximum offer price, and 10.08% of post-IPO capital.

Cornerstone investors have no board representation, no special rights beyond guaranteed allocation at the final offer price, and will not become substantial shareholders. There are no side arrangements, and the investments comply with the relevant listing rules and guidance.

Deal Parties and Offer Structure: Institutional Strength

Lead Deal Parties:

• Sponsor, Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner, Joint Lead Manager: China International Capital Corporation Hong Kong Securities Limited
• Joint Global Coordinators, Bookrunners, and Lead Managers: ICBC International Securities Limited, Guosen Securities (HK) Brokerage Company, Limited, Huafu International Securities Limited, SPDB International Capital Limited, China Industrial Securities International Capital Limited, GF Securities (Hong Kong) Brokerage Limited, ABCI Securities Company Limited, China Galaxy International Securities (Hong Kong) Co., Limited, Patrons Securities Limited, West Bull Securities Limited, Futu Securities International (Hong Kong) Limited, Livermore Holdings Limited, Tiger Brokers (HK) Global Limited

Underwriting: The Hong Kong Public Offering is fully underwritten on a conditional basis. The International Offering is expected to be fully underwritten, subject to the terms of the International Underwriting Agreement.

Stabilization/Greenshoe: The Over-allotment Option (up to 15% of the offer) enables market stabilization post-listing. The presence of multiple top-tier banks and a robust greenshoe mechanism supports first-day performance from a process and risk-management perspective.

Company Overview: Business Model, Revenue Streams, and Competitive Position

Yiyang Tongrentang is a specialized healthcare group focusing on the operation of pharmacies, hospitals, and related healthcare businesses. The company’s revenue streams include:

• Pharmacy Operations (including SXT Pharmacies Group)
• Hospital Services (including SXT Hospital)
• Related healthcare solutions and products

Business Model: The company generates revenue primarily from sales of medicine, healthcare products, and provision of medical services to a broad customer base across China. Its operations are geographically diversified, and the company leverages brand strength, long-standing history, and a multi-channel distribution model.

Industry Size: According to an independent Frost & Sullivan report (commissioned by the company), the healthcare and pharmacy sector is large and growing, but specific market size figures are not disclosed in the publicly extractable content here.

Financial Health: Key Ratios and Performance

The company has experienced steady improvement in profitability, with net margins rising from negative in 2022 to 3.9% in 2024, and gross margin improving to 18.9%. Liquidity remains robust, with current ratio of 1.4x as of September 30, 2025. No major debt or off-balance sheet arrangements are flagged. The directors confirm no material adverse change in financial position since September 2025.

Yiyang Tongrentang touts significant brand recognition and an established presence in China’s healthcare sector. The company meets all listing requirements for market capitalization, revenue, and cash flow, with 2024 revenue of RMB1,175.1 million, expected market capitalization well above the HK\$2 billion threshold, and positive operating cash flow exceeding HK\$100 million in the past three years.

Management Team: The directors and key executives are responsible for compiling all offer details and financial statements and are subject to lock-up and reporting requirements post-listing. Detailed biographies and experience are provided in the full prospectus.

Sector Trends, Timing, and Market Environment

Healthcare and pharmacy demand continues to rise in China, driven by demographic shifts, rising incomes, and increased health consciousness. The IPO is strategically timed:

• Offer Period: March 20, 2026 (9:00am) – March 25, 2026 (12:00 noon)
• Expected Price Determination Date: By 12:00 noon, March 26, 2026
• Result Announcement: No later than 11:00pm, March 27, 2026

The company highlights a stable macro and regulatory environment, with recent industry growth and no material adverse developments since its last audited period.

Key Risk Factors: Quantified and Unquantified Exposures

Investors should note several risks disclosed:

• Market Risk: Trading price and volume of H Shares may be volatile post-listing due to operating results, macro events, or sector developments.
• Dividend Uncertainty: No assurance of future payouts.
• Reliance on Government Data: Some industry facts are based on official statistics, which may not always be up-to-date or independently verified.
• Forward-Looking Statements: Business strategies and financial projections are subject to risks and uncertainties, including regulatory, competitive, and economic trends.
• Regulatory/Legal: Subject to PRC laws and Hong Kong listing regulations, with all compliance and waivers granted as described.
• Related Party Transactions: Historical related party dealings were at arm’s length and will be compliant post-listing.

Growth Strategy: Expansion, M&A, and Business Development

The company’s declared growth path includes:

• Further expansion of pharmacy and hospital businesses
• Pursuing M&A and strategic investments
• Enhancing product offerings and customer reach
• Allocating IPO proceeds primarily to expansion and working capital

Ownership and Lock-Up Arrangements

Pre- and Post-IPO Shareholding Structure:

• Public float after the IPO will be at least 25%, meeting all regulatory requirements.
• Controlling shareholders and pre-IPO investors are subject to strict lock-up periods: six months from listing for disposals, with further notification and disclosure requirements for pledging or charging shares in the following six months.
• No major pre-listing disposals or sales by key shareholders are indicated.

Listing Outlook: First-Day Performance and Investor Takeaways

Based on the disclosed facts, Yiyang Tongrentang’s IPO is well-structured with strong cornerstone support, reputable underwriters, and compliance with all regulatory requirements. A robust greenshoe mechanism and prudent financial status support the likelihood of a stable listing debut. However, the absence of a dividend commitment and the company’s relatively modest net margins may temper aggressive first-day gains. With no negative developments since the last audit and a clear growth agenda, the IPO appears attractive for growth-focused investors, with first-day performance likely to be stable to strong relative to the offer price, assuming healthy subscription demand.

Prospectus Access

Full offer details and the official prospectus are available at:

• www.hkexnews.hk
• yiyang.tongrentang.com

How to Apply for Yiyang Tongrentang H Shares

Application Channels: Investors may apply for H Shares via the following methods:

• Online via the White Form eIPO Service Provider at www.eipo.com.hk
• Through HKSCC EIPO service by instructing your broker or custodian (who is an HKSCC Participant) to submit electronic application instructions through HKSCC’s FINI system

Application Period: 9:00am, March 20, 2026 to 12:00 noon, March 25, 2026 (Hong Kong time).

Eligibility: Applicants must be 18 years or older and have a Hong Kong address for White Form eIPO use. Existing shareholders, their close associates, and company directors/supervisors (and their close associates) are not eligible to apply in the public tranche.

Result Announcement: Allocation results will be published no later than 11:00pm, March 27, 2026, on www.hkexnews.hk, yiyang.tongrentang.com, and www.iporesults.com.hk.

Yiyang Tongrentang’s IPO offers a compelling entry into China’s expanding healthcare sector, with a clear growth mandate, prudent financials, and strong institutional backing. Investors should weigh the company’s low but rising profitability and lack of dividend commitment against its brand strength, expansion plans, and robust offer structure.