Executive Summary

China Healthwise Holdings Limited (“the Group” or “the Company”) has released its Annual Report for the year ended 31 December 2025. The report covers significant updates on investment strategies, risk management, capital structure, and post-year-end events, all of which are of critical importance to shareholders and potential investors. Several actions and changes disclosed in this report have the potential to impact the Company’s share price.

Key Points and Strategic Developments

• Investment Policy and Portfolio:
  • The Group maintains a diversified portfolio, investing surplus funds in regulated banks, listed equity securities on major global exchanges (HKEX, LSE, NASDAQ, NYSE, SGX), and investment-grade bonds (rated A or above by agencies like Moody’s, S&P, and Fitch). Other investments, including unlisted securities, require Board approval.
  • Strict prohibition of speculative or high-risk investments: Derivatives linked to commodities, day trading, and any investments breaching set concentration limits are not permitted. This ensures prudent risk control and focus on sustainable returns.
  • Performance Benchmark: Investment returns are benchmarked against the prevailing 12-month HKD time deposit rate, with the aim to at least match or outperform this benchmark.
• Risk and Liquidity Management:
  • Comprehensive risk framework in place, covering credit, interest rate, liquidity, foreign exchange, concentration, and economic risks.
  • Concentration Limits: No single investment exceeds 10% of total assets; non-Hong Kong assets limited to 10% of portfolio.
  • Ongoing Monitoring: Daily and monthly reports on investment performance and risk are reviewed by both designated directors and the Board.
• Investment Decision Process and Governance:
  • Board Oversight: The Board approves the investment policy and material investments/disposals, reviews performance and risk monthly, and updates the policy at least annually.
  • Designated Directors: Executive directors Mr. Lei and Mr. Cheung (each with over 20 years’ experience) handle day-to-day investment management, with cross-approval required for all decisions.
  • Treasury Team: Experienced professionals (including CPAs) support investment research, execution, reconciliation, and reporting.
• Capital and Dividend Policy:
  • No pre-set dividend payout ratio, with distributions reflecting earnings, capital needs, and investment opportunities. The Board aims for sustainable and progressive dividends.
  • At least 80% of annual investment income and realised gains are remitted to the treasury, supporting both dividends and reinvestment.

Key Price-Sensitive and Shareholder-Relevant Information

• Going Concern Uncertainty:
  • The auditors and directors highlight a material uncertainty regarding the Group’s ability to continue as a going concern, given that the Group’s liquidity is dependent on:
    • Timely collection of loan receivables
    • Timely disposal of financial assets to generate cash
    • Execution of further cost controls
    • Successful refinancing or renewal of bonds and borrowings as they fall due

    Failure to achieve these could result in the need for significant asset write-downs and reclassification of liabilities, which would have a material adverse impact on the Company’s financial position and share value.

• Significant Post-Year-End Events:
  • Forced Sale of Investment: In January 2026, a wholly-owned subsidiary was forced to sell 2,646,000 shares of Yunfeng Financial Group Limited for approximately HK\$9.2 million. The forced sale indicates possible liquidity constraints and could impact asset values.
  • Loan Extension and Rate Adjustment with Connected Party: In March 2026, a subsidiary extended the repayment of up to HK\$9 million to a major shareholder (Yongheng Strategy Investment Limited) by one year (to March 2027) and raised the interest rate to 10% per annum. This is a connected transaction and may attract regulatory and investor scrutiny.
• Money Lending Business:
  • The money lending environment remains challenging due to interest rate volatility and geopolitical tensions (notably in the Middle East and US-China relations), which could suppress borrower demand and raise credit risks.
  • The Group is strengthening credit controls and recovery efforts, including revising repayment terms, requiring collateral, and enforcing legal claims where necessary.
• Capital Structure and Public Float:
  • As of 31 December 2025, the Company maintained a public float of 70.7%, well above the 25% regulatory minimum, with 770,480,836 shares issued.
  • No new fundraising occurred during the year, and no significant acquisitions or disposals outside of those disclosed.

Other Notable Details

• Corporate Governance:
  • The Company was in compliance with the Corporate Governance Code, except for a lapse in Directors’ insurance coverage (currently being addressed).
  • The Board comprises experienced executive and independent directors, supporting strong governance and oversight.
• Financial Reporting and Audit:
  • The independent auditors did not identify any other material issues apart from the going concern risk.
  • Audit fees for the year amounted to approximately HK\$900,000.

Potential Impact on Share Value

• Going concern risk and the need for asset realisation or refinancing may weigh negatively on investor sentiment and share price.
• The forced sale of key investment assets and extension of a material related party loan at a high interest rate may signal underlying liquidity pressures, further impacting valuation and market confidence.
• Any failure to collect loan receivables, execute cost controls, or renew/refinance debt could result in significant adverse financial adjustments.

Conclusion

While China Healthwise Holdings Limited maintains robust risk controls, a diversified investment approach, and strong governance, investors must be aware of the material uncertainties related to liquidity and the going concern status. The recent forced sale of investments and related party transactions further underline the importance of monitoring the Company’s cash flows and balance sheet health closely.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consider their own financial situation and risk tolerance before making any investment decisions. The Company’s actual performance may differ materially from the scenarios described above due to future market developments and internal management actions.