The latest: Internet healthcare company Sipai Health Technology Co. Ltd. (0314.HK) made its trading debut in Hong Kong on Friday by opening 27.4% above its IPO price of HK$18.60.

Looking up: The local portion of the offering was subscribed by 7,588 investors for a total of 8.2 million shares, representing an oversubscription rate of 7.3 times.

Take Note: The company raised only HK$120 million ($15.4 million), a relatively small amount compared to its cumulative losses of more than 5.7 billion yuan over the past three and a half years.

Digging Deeper: Founded in 2014, Sipai Health’s businesses cover medical, pharmaceutical and insurance services. Its backers include number of big names, such as technology giant Tencent Holdings (0700.HK), F-Prime Capital, Ping An Ventures and IDG Capital. Its “medical-drug-insurance” business ecosystem helped its revenue rise steadily from 2019 to 2021, but its net losses also grew during that period, making it heavily reliant on new investment to continue operating. But Sipai has vowed to turn a profit in the next three to five years by boosting revenues and improving operating efficiency.

Market Reaction: After the strong opening, Sipai Health’s stock varied during the morning session before surging to close up 34.9% at HK$25.10 by the midday break.

Translation by Jony Ho

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