Core Viewpoint - Harbin Yuyantang Traditional Chinese Medicine Clinic Group Co., Ltd. (Yuyantang) is set to list on the Hong Kong Stock Exchange, aiming to expand its traditional Chinese medicine services through a fully integrated treatment model and a self-built network of licensed medical institutions [3][5]. Group 1: Company Overview - Yuyantang was established in 2018 and operates a network of 48 self-built licensed medical institutions in Northern China, ensuring standardized operations and consistent care quality [5]. - The company ranks fifth among private chain TCM service providers in China by total revenue and first in revenue from traditional Chinese medicine preparations [5]. - Yuyantang has a high customer loyalty rate, with a repurchase rate of 81.1% in the first three quarters of 2025 [5]. Group 2: Service Model and Offerings - The company follows a "one person, one prescription" principle, offering personalized TCM preparations, including decoctions, pills, powders, and ointments, enhancing patient compliance [6]. - Yuyantang has developed proprietary in-house formulations based on clinical experience, which are integral to its chronic disease management processes [6]. Group 3: Workforce and Innovation - As of January 6, 2026, Yuyantang employs 292 full-time medical professionals and has a research committee of 98 experts, driving innovation and improving patient care standards [7]. - The TCM service market in China is projected to grow from 659.9 billion yuan in 2019 to 1,020.16 billion yuan by 2024, with a compound annual growth rate of 10.1% expected until 2029 [7]. Group 4: Future Development Plans - Yuyantang plans to expand its geographic footprint in provinces like Shandong, Hebei, Henan, and Tianjin, focusing on self-built and self-operated models to enhance market penetration [8]. - The company aims to digitally transform its production facilities and strengthen its service and product value through standardized TCM services and backend product collaboration [8]. Group 5: Financial Performance - Yuyantang's revenue for 2023 and 2024 is projected at 150 million yuan and 215 million yuan, respectively, reflecting a year-on-year growth of 43.5% [8]. - For the first three quarters of 2025, revenue increased by 96.6% to 284 million yuan compared to the same period in 2024 [8]. - The adjusted net profit margins for 2023, 2024, and the first three quarters of 2025 are 13.7%, 12.6%, and 21.7%, respectively [9]. Group 6: IPO Fund Utilization - Approximately 33% of the IPO proceeds will be used to open new licensed medical institutions, while 24% will enhance production capacity [9]. - Other allocations include 10% for developing intelligent systems, 10% for brand enhancement, and 5% for optimizing TCM services, particularly in in-house formulations [9].