JOINN Laboratories (China) Announces Discloseable Transaction: Subscription of CITIC Securities Financial Products

Key Highlights

• JOINN Laboratories (China) Co., Ltd. (Stock code: 6127) has announced a significant financial move involving the subscription of further financial products from CITIC Securities and its subsidiaries.
• As of 16 March 2026, the aggregate outstanding investment in CITIC Securities Financial Products has reached RMB460,000,000.
• The transaction now constitutes a discloseable transaction under Chapter 14 of the Hong Kong Listing Rules after the latest subscription, as the aggregate percentage ratios exceed 5% but remain below 25%.
• The subscription is aimed at maximizing the utilization of surplus cash balances, with an expectation of higher returns compared to traditional bank deposits.

Details of the Financial Products Subscribed

The Group has subscribed for eight CITIC Securities Financial Products, each with specific terms, principal amounts, and expected returns:

1. First CITIC Securities Financial Product
   • Date: 4 September 2025
   • Principal: RMB10,000,000
   • Expected Annual Return: 3.0%
   • Maturity: Redeemable after half year of holding
   • Expected Interest: RMB300,000
2. Second CITIC Securities Financial Product
   • Date: 13 October 2025
   • Principal: RMB50,000,000
   • Expected Annual Return: 2.15% – 5.15%
   • Maturity: 22 April 2026
   • Expected Interest: RMB550,000 – RMB1,320,000
3. Third CITIC Securities Financial Product
   • Date: 17 November 2025
   • Principal: RMB80,000,000
   • Expected Annual Return: 2.15% – 5.15%
   • Maturity: 27 May 2026
   • Expected Interest: RMB880,000 – RMB2,110,000
4. Fourth CITIC Securities Financial Product
   • Date: 15 December 2025
   • Principal: RMB20,000,000
   • Expected Annual Return: 2.15% – 5.15%
   • Maturity: 24 June 2026
   • Expected Interest: RMB220,000 – RMB530,000
5. Fifth CITIC Securities Financial Product
   • Date: 23 December 2025
   • Principal: RMB10,000,000
   • Expected Annual Return: 1.5% – 4.5%
   • Maturity: Redeemable after 90 days of holding
   • Expected Interest: RMB150,000 – RMB450,000
6. Sixth CITIC Securities Financial Product
   • Date: 23 December 2025
   • Principal: RMB10,000,000
   • Expected Annual Return: 1.5% – 4.5%
   • Maturity: Redeemable after 90 days of holding
   • Expected Interest: RMB150,000 – RMB450,000
7. Seventh CITIC Securities Financial Product
   • Date: 16 March 2026
   • Principal: RMB100,000,000
   • Expected Annual Return: 2% – 5%
   • Maturity: 23 September 2026
   • Expected Interest: RMB1,020,000 – RMB2,560,000
8. Eighth CITIC Securities Financial Product
   • Date: 16 March 2026
   • Principal: RMB180,000,000
   • Expected Annual Return: 1.5% – 4.5%
   • Maturity: Redeemable after 90 days of holding
   • Expected Interest: RMB2,700,000 – RMB8,100,000

Current Status and Financial Impact

• The Group confirms that, except for the CITIC Securities Financial Products and the First CITIC Securities Financial Product (from a previous announcement), all other financial products previously subscribed from CITIC Securities have been redeemed in full according to their terms.
• The Directors believe that the subscriptions will yield reasonable interest and will not adversely impact the Group’s financial position.
• The investments are funded by surplus cash and are highly liquid, ensuring no negative effect on working capital or operations.
• These products are closely monitored and managed for risk and liquidity.

Reasons and Benefits for Investors

• The primary rationale for these subscriptions is to maximize the return on surplus cash, which would otherwise be earning lower interest in traditional bank deposits.
• The CITIC Securities Financial Products are considered to have relatively low risk exposure, offer better rates than commercial bank deposits, and have short maturity terms (within 12 months or redeemable within one year).
• This move aligns with prudent cash management and could enhance earnings, potentially benefiting shareholders in the long term.

Listing Rules Implications

• Prior subscriptions did not trigger disclosure requirements as their aggregate ratios were below 5%.
• With the Seventh and Eighth products, the aggregate ratios now exceed 5%, making this a discloseable transaction under Chapter 14, subject to notification and announcement requirements.
• This increased level of investment, transparency, and disclosure is material and may be of interest to shareholders and could affect share price due to improved cash management and potential earnings enhancement.

Information on Parties Involved

• The Group is a leading non-clinical CRO in China, expanding into integrated drug R&D services including discovery, non-clinical, and clinical trial stages.
• JOINN Management Technology is a wholly-owned subsidiary focused on investment management.
• CITIC Securities is a publicly-listed company in Shanghai and Hong Kong, engaged in comprehensive financial services.
• China Capital (62.2% owned by CITIC Securities) focuses on private equity investment.
• CITIC Securities Asset Management is wholly owned by CITIC Securities and focuses on asset management.
• All parties are confirmed as independent third parties with respect to JOINN Laboratories.

Potential Price Sensitivity

• The move to invest RMB460 million in highly liquid, low-risk financial products is a substantial deployment of surplus funds and could positively impact future earnings, making it potentially price sensitive.
• Ongoing interest income from these products may enhance profitability, and the improved transparency and governance could also be viewed favorably by investors.
• There are no adverse impacts expected on the Group’s liquidity or financial health.

Board and Management

• The Board comprises a mix of executive, independent non-executive, and employee directors, led by Chairperson Ms. Feng Yuxia.
• All directors have reviewed and approved the transaction, considering it fair, reasonable, and in the best interests of the Company and shareholders.

Conclusion

JOINN Laboratories’ substantial investment in CITIC Securities Financial Products represents a strategic deployment of surplus cash in pursuit of higher yields, liquidity, and low risk. The transaction’s disclosure under Hong Kong Listing Rules highlights its materiality and potential impact on future earnings, which may be closely watched by investors for its effect on shareholder value.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult with professional advisors before making any investment decisions based on this news. The information herein is based on public disclosures and may be subject to change.

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