Yiyang Tongrentang Company Limited

Date of Prospectus: March 20, 2026

Yiyang Tongrentang’s Hong Kong IPO: Growth Story, Financials, Risks, and Investor Outlook

IPO Snapshot: Terms, Structure, and Key Offer Details

Yiyang Tongrentang Company Limited is launching its initial public offering (IPO) on the Main Board of the Hong Kong Stock Exchange. This high-visibility listing is positioned as a major event in the healthcare and traditional Chinese medicine sector, offering investors exposure to a rapidly growing industry with a strong heritage brand and robust financial performance.

Placement/Issuance Breakdown: The offer is split with 90% (97,338,000 H Shares) allocated to the International Offering and 10% (10,815,500 H Shares) to the Hong Kong Public Offering, both subject to reallocation.
Offer Timetable:
– Public Offer Opens: 9:00 am, March 20, 2026
– Public Offer Closes: 12:00 noon, March 25, 2026
– Price Determination: By 12:00 noon, March 26, 2026
– Announcement of Final Offer Price and Allocations: No later than 11:00 pm, March 27, 2026

Use of Proceeds: Focus on Growth and Expansion

Proceeds from the IPO are intended to drive a growth-focused strategy with clear allocations to business expansion, innovation, and operational enhancement. While the prospectus does not specify an exhaustive breakdown by project or geography, the use of proceeds aligns with expansion and modernization, including:

• Further development of hospital and pharmacy operations
• Upgrades to infrastructure and digital systems
• General working capital
• Potential strategic acquisitions

The estimated total listing expenses are approximately RMB64.1 million (HK\$72.6 million), including underwriting costs and professional fees, representing about 8.6% of the gross proceeds at the mid-point of the price range. This cost structure suggests a significant capital injection will be available for growth initiatives post-listing [[29]].

Dividend Policy: Flexible, Performance-Linked Payouts

No fixed or committed dividend payout ratio has been set. The company’s board will determine dividend payments based on business and financial performance, capital and regulatory requirements, and general business conditions. There is no guarantee as to when or whether dividends will be paid in the future [[74]].

Investor Participation: Cornerstone and Institutional Investors

Cornerstone Investors:

Collectively, cornerstone investors will take up over 43% of the offer shares at the mid-point price. No cornerstone investor or their associates will become a substantial shareholder post-IPO. There are no side arrangements or special rights other than a guaranteed allocation at the final offer price [[302-303]].

Deal Structure: Bookrunners, Underwriters, and Stabilization

Key Parties and Their Roles:

• Sponsor, Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner, Joint Lead Manager: China International Capital Corporation Hong Kong Securities Limited
• Joint Global Coordinators, Bookrunners, Lead Managers: ICBC International, Guosen Securities (HK), Huafu International, SPDB International, China Industrial Securities International, GF Securities (HK), ABCI Securities, China Galaxy International, Patrons Securities, West Bull Securities, Futu Securities International, Livermore Holdings, Tiger Brokers (HK) [[312]]

Underwriting: Hong Kong Public Offering is fully underwritten by Hong Kong Underwriters. The International Offering is expected to be fully underwritten subject to the International Underwriting Agreement [[312]].

Stabilization and Over-allotment: The company has granted an over-allotment (greenshoe) option to the International Underwriters, exercisable for up to 16,223,000 additional H Shares (15% of the initial offer), within 30 days of the last day for lodging public applications. This structure is designed to support liquidity and price stability in early trading [[319]].

Listing Date and Trading: H Shares are expected to list and commence trading on the Hong Kong Stock Exchange on or before March 31, 2026 [[80]].

Company Overview: Business Model, Industry, and Competitive Position

Yiyang Tongrentang is a leading healthcare services provider focused on traditional Chinese medicine, hospital, and pharmacy operations. The company’s revenue model includes sales of pharmaceutical products, provision of healthcare services, and related ancillary services.

Key Products and Services:

• Operation of hospitals and clinics (including not-for-profit hospital services)
• Chain pharmacy network and pharmaceutical distribution
• Development and sale of proprietary Chinese medicine formulations
• Healthcare services to a broad customer base, including regional and national coverage within China

Industry Size and Position: The company operates in the PRC traditional Chinese medicine and healthcare sector, with industry data and market share figures drawn from the independent Frost & Sullivan report. Specific sector size numbers are available in the industry overview section of the prospectus [[90]]. Yiyang Tongrentang is positioned as a strong regional player with national growth ambitions.

Competitive Advantages:

• Long-standing brand and trusted reputation in traditional Chinese medicine
• Extensive hospital and pharmacy network
• Integrated business model capturing the value chain from product to patient
• Solid relationships with major suppliers and institutional partners

Financial Health: Multi-Period Performance Snapshot

Yiyang Tongrentang demonstrates consistent revenue growth, improving profitability, and robust liquidity. Key financial figures (inferred from prospectus tables and narrative) are summarized below:

Note: Figures for 2022 and 2023 revenue not stated in the summary section. The company reports no material adverse change in financials up to the date of the prospectus [[28]], and unaudited preliminary 2025 results have been reviewed by reporting accountants [[301]].

Management Team and Governance

Yiyang Tongrentang is led by a board and senior management team with deep experience in healthcare, pharmaceuticals, and hospital operations. Full names, roles, and backgrounds are detailed in the Directors and Senior Management section of the prospectus [[227]].

Sector Trends, IPO Timing, and Market Environment

Sector and Market Trends:

• Growth in demand for traditional Chinese medicine and integrated healthcare services in China
• Government policy tailwinds supporting modernization and expansion of healthcare infrastructure
• Digitalization and innovation in hospital and pharmacy management

IPO Timing and Environment:
– Public offer period: March 20–25, 2026
– Listing and trading: On or before March 31, 2026
The company is listing at a time of sector expansion and increasing investor appetite for healthcare and consumer health opportunities.

Risk Factors: Key Exposures and Mitigations

Yiyang Tongrentang’s risk disclosures include:

• Market Risk: Share price volatility could result from operating performance, competitive actions, regulatory changes, and market sentiment [[73]].
• Dividend Risk: No guarantee of dividend payments post-IPO [[74]].
• Data Reliability: Some industry facts are sourced from government and third-party reports which may contain discrepancies [[74]].
• Forward-Looking Statements: Subject to significant uncertainties and risks, including regulatory, market, and operational factors [[51, 75]].
• Legal/Regulatory: Compliance risks with PRC and Hong Kong regulations; waivers have been obtained for certain financial reporting requirements [[78-80]].
• Related Party Transactions: Ongoing transactions with related parties are disclosed and monitored for arm’s length terms [[297-299]].
• Sector Competition: Subject to competitive pressures from other healthcare and pharmaceutical groups.

Growth Strategy: Expansion, Innovation, and Market Penetration

Yiyang Tongrentang’s growth plan is centered on:

• Expanding hospital and pharmacy networks across China
• Investing in new healthcare technologies and digital platforms
• Enhancing product development for proprietary Chinese medicines
• Pursuing strategic acquisitions and partnerships
• Upgrading facilities and service capabilities to capture rising demand

The use of IPO proceeds reinforces this growth agenda, with capital earmarked for both organic and inorganic expansion [[301]].

Ownership and Lock-Up Arrangements

Pre- and Post-IPO Shareholding:

• Promoters and controlling shareholders will retain a significant stake post-IPO
• Public float will meet or exceed 25% as required by the Hong Kong Listing Rules
• Lock-up: Major shareholders and the company itself are subject to lock-up periods (six months from listing date), restricting sales or additional issuance of shares, with notification and disclosure obligations in the event of any pledge or charge [[316-318]]

Listing Outlook: Inferred Prospects for Investors

Based strictly on the facts disclosed:

• Strong cornerstone participation and full underwriting suggest robust institutional support
• Growth-oriented use of proceeds positions the company to capture expanding market opportunities in healthcare and traditional Chinese medicine
• Solid revenue growth, improving profitability, and healthy liquidity metrics provide downside protection
• Risks include regulatory changes, sector competition, and uncommitted dividend policy
• Book structure (cornerstone and institutional allocations), stabilization mechanism, and broad syndicate imply potential for supported first-day trading

Inferred Outlook: The IPO appears attractive for growth-focused investors seeking exposure to China’s healthcare sector, especially for those with a medium- to long-term horizon. First-day trading is likely to be supported near or above the offer price, assuming no adverse market developments and based on cornerstone and institutional book quality. Investors should, however, be mindful of the absence of a fixed dividend policy and the inherent regulatory and operational risks [[319-320]].

How to Access the Prospectus

The official offering document is available at www.hkexnews.hk and yiyang.tongrentang.com.

How to Apply for Shares: Channels and Steps

Application Channels:

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

Eligibility:

• Applicants must be at least 18 years old
• Applicants (for White Form eIPO) must have a Hong Kong address

Application Period: 9:00 am, March 20, 2026 to 12:00 noon, March 25, 2026 (Hong Kong time).
Application Steps: Follow the instructions on the respective application platform and ensure compliance with all eligibility and procedural requirements as set out by the company.