FAST NEWS: So-Young Upsizes Share Repurchase Program
The Latest: Cosmetic surgery app operator So-Young International Inc. (SY.US) said on Tuesday it will upsize its share repurchase program announced late last year from an original $15 million to $25 million for the 12 months starting from Nov. 18, 2022.
Looking Up: The upsizing reflects the company’s confidence in its development. That might stem from changes in its operating environment as China ends its many Covid restrictions. The growing confidence could also owe to improving investor sentiment towards U.S.-listed Chinese stocks with the resolution of a dispute between Chinese and American securities regulators.
Take Note: So-Young has yet to prove it can bounce back from business declines during China’s Covid disruptions. Its mobile active users dropped to 3.9 million in last year’s third quarter from 8 million a year earlier, and its net profit dived to 2.3 million yuan from 6.8 million yuan over the period.
Digging Deeper: So-Young, which operates a plastic surgery services platform, has been on a roller coaster ride since listing in New York three years ago. It faced a major challenge from China’s “zero Covid” policy, and also from a separate regulatory crackdown on China’s medical aesthetics sector. In November 2021, it received a management-led offer to take the company private at a price of $5.30 per American depositary share (ADS). However, the offer was withdrawn in October last year as So-Young’s shares plunged into penny territory. The stock has bounced back from lows last November, amid a broader rally for U.S.-listed Chinese stocks.
Market Reaction: So-Young shares rose 12.4% to $1.45 after the announcement on Tuesday. The stock now trades in the middle of its 52-week range.
Reporting by Chan Ka Po
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