Global Healthcare Analyst

Tina Banerjee

Equity Capital Markets

Wuhan Dazhong Dental Medical / Equity Capital Markets

<ul>
<li>Wuhan Dazhong Dental Medical launched IPO aiming to raise up to HK$232 million (US$30 million). The company plans to sell 10.8 million shares at HK$20–HK$21.4 per share.</li>
<li>Wuhan Dazhong Dental Medical is a private dental services provider in Central China providing dental services under the direct chain model.</li>
<li>The IPO price is set at a premium (23%) to the price realized during Series B funding. Valuation looks attractive. But there are a few concerns to take into account.</li>
</ul>


Wuhan Dazhong Dental Medical launched IPO aiming to raise up to HK$232 million (US$30 million). The company plans to sell 10.8 million shares at HK$20–HK$21.4 per share.
Wuhan Dazhong Dental Medical is a private dental services provider in Central China providing dental services under the direct chain model.
The IPO price is set at a premium (23%) to the price realized during Series B funding. Valuation looks attractive. But there are a few concerns to take into account.


Wuhan Dazhong Dental Medical IPO: Shine Revival Will Take a Few Sessions

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>In other to attract and retain high-quality dentists, dental services providers need to pay higher salaries than public hospitals, which inevitably drives up manpower costs and drag down profit margin.</li>
<li>Regulatory pricing controls and centralized procurement policies on dental implants and orthodontic materials will affect the pricing of Dazhong’s dental services, thus put pressure on its future revenue growth.</li>
<li>The future valuation performance largely depends on if Dazhong is able to expand out of Central China and achieve nationwide coverage. However, so far, no successful cases have emerged.</li>
</ul>


In other to attract and retain high-quality dentists, dental services providers need to pay higher salaries than public hospitals, which inevitably drives up manpower costs and drag down profit margin.
Regulatory pricing controls and centralized procurement policies on dental implants and orthodontic materials will affect the pricing of Dazhong’s dental services, thus put pressure on its future revenue growth.
The future valuation performance largely depends on if Dazhong is able to expand out of Central China and achieve nationwide coverage. However, so far, no successful cases have emerged.


Pre-IPO Wuhan Dazhong Dental Medical - Valuation Performance May Disappoint Investors

China

Wuhan Dazhong Dental Medical Co., Ltd. offers dental services. The Company provides oral internal medicine and surgery services, oal rehabilitation, orthodontic treatment, oral implantation, dental aesthetic repairing, and other services. Wuhan Dazhong Dental Medical also sells medical equipment.

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Wuhan Dazhong Dental Medical (2651 HK)

Wuhan Dazhong Dental Medical IPO: Shine Revival Will Take a Few Sessions

Wuhan Dazhong Dental launched IPO aiming to raise $30M. The company plans to sell 10.8M shares at HK$20–21.4 per share. Share subscriptions will...

Tina Banerjee

Pre-IPO Wuhan Dazhong Dental Medical - Valuation Performance May Disappoint Investors

To attract top dentists, dental service providers have to pay higher salaries, impacting profit margins. VBP will affect revenue growth for...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Wuhan Dazhong Dental Medical IPO: Shine Revival Will Take a Few Sessions

Wuhan Dazhong Dental launched IPO aiming to raise $30M. The company plans to sell 10.8M shares at HK$20–21.4 per share. Share subscriptions will...

Tina Banerjee

Pre-IPO Wuhan Dazhong Dental Medical - Valuation Performance May Disappoint Investors

​To attract top dentists, dental service providers have to pay higher salaries, impacting profit margins. VBP will affect revenue growth for...

Xinyao (Criss) Wang

To attract top dentists, dental service providers have to pay higher salaries, impacting profit margins. VBP will affect revenue growth for...