By
Darya Rudz
November 1st, 2023
JD Health has earmarked 381.9 million shares for the IPO which it is set to be sold for a price from HK$62.80 to HK$70.58.
JD Health International Inc, the healthcare arm of Chinese retail giant JD.com, is set to make its debut on the Hong Kong Stock Exchange in what is slated to be the biggest Hong Kong Initial Public Offering (IPO) of the year. As reported by Reuters, JD Health seeks about $3.5 billion in the proposed IPO according to figures from a term sheet filed.
The popularity of digital healthcare platforms rose from late 2019 to date with the coming of the COVID-19 pandemic. With social distancing becoming a matter of necessity around the world in a bid to help stop the spread of the coronavirus pandemic, people turned to digital healthcare service providers for consultations and medications. This remains one of the ways in which JD Health increased its relevance over the past one year. The outfit has about 72.5 million annual active users as of June 30 compared to 53.5 million in the year-ago period and reports a revenue of $1.6 billion in 2019.
Per the Reuters report, the IPO may be followed by a greenshoe option. A greenshoe option is an over-allotment of the shares of a company in the advent that the company’s shares in the context of an IPO see a better than expected valuation. This may prompt the company to issue more shares beyond what it initially planned. Should the greenshoe option be exercised in the case of JD Health, the outfit’s valuation is expected to top $29 billion.
JD Health has earmarked 381.9 million shares for the IPO which it is set to be sold for a price from HK$62.80 to HK$70.58. It would bring a total monetary value of $3.5 billion with a surge up to $4 billion if an additional 15% shares are issued out following through the greenshoe option.
As reported by Bloomberg, about six of JD Health partners have taken up to about $1.35 billion of the proposed IPO value and these investors include BlackRock Inc (NYSE: BLK), Hillhouse Capital, and GIC Pte, a Singapore based Sovereign wealth fund, amongst others.
Halted Ant Group IPO Gives JD Health the Opportunity to Take the Crown
Chinese bourses have seen an uptick in new listings this year following fears by Chinese firms who do not want to go public in the US due to the Trump administration’s clampdown. Of the listings this year, the scheduled IPO from Alibaba-backed Ant Group was suspended by Chinese authorities due to frictions between Alibaba’s chief Jack Ma and regulators.
The Ant Group’s IPO was initially projected to be the biggest for the year not just in Hong Kong but the biggest one that has ever been reported by any company. The suspension of the IPO apparently paved the way for JD Health that is now to be accorded for making the biggest debut on a public exchange this year.
JD Health’s stock is billed to start trading from the 8th of December 2020.