Good Doctor Aims to Raise $1.1 Billion in Hong Kong IPO

A health care unit of Ping An Insurance Group, China’s second-largest life in-surer by premiums, plans to raise as much as HK$8.77 billion ($1.13 billion) in its Hong Kong listing scheduled for next Friday.

Ping An Healthcare and Technology Co. Ltd., widely known as Ping An Good Doctor, is offering about 160 million shares priced between HK$50.80 and HK$54.80 each, the company said.

Retail investors will be offered 6.5% of the allocated shares, with the rest targeted at international institutional investors, it said.

Caixin reported in January that Good Doctor planned to raise around HK$7.8 billion, and a source said potential investors had been reserved for the initial public offering (IPO) amid the company’s unprofitability.

Good Doctor posted its third consecutive loss last year at 1 billion yuan ($154.8 million), widening from 758 million yuan in 2016 and 324 million yuan in 2015.

However, its floatation in Hong Kong appears to have attracted strong interest from global investors. All seven cornerstone investors — including BlackRock Inc., Singapore sovereign fund GIC, and the Canada Pension Plan Investment Board — have subscribed to around half of the shares allocated for institutional investors, according to its initial public offering prospectus.

In February, Japanese tech giant SoftBank’s Vision Fund was among the investors in the $400 million pre-IPO round for Good Doctor.

Good Doctor offers on-demand services such as connecting patients with doctors for consultations and diagnoses, allowing them to make outpatient appointments or get rehabilitation advice. It also boasts an online health mall that sells medications and medical equipment.

The company is currently China’s largest such platform, with 32.9 million monthly active users and a daily average of 370,000 online consultations in 2017, beating rival Tencent Holdings Ltd.’s WeDoctor.

Good Doctor said it aims to tap China’s rising demand for quality health care services, as “the lack of quality primary care and the scarcity and uneven distribution of quality medical resources” have plagued the country for many years.

Total health care expenditures in China are expected to grow to 11.4 trillion yuan in 2026, from 4.6 trillion yuan in 2016, according to research firm Frost & Sullivan.

Contact reporter Jason Tan (jasontan@caixin.com)