Today (November 26), Alibaba Health (00241. HK) continues to weaken. After yesterday's share price touched HK$7.52, it closed at HK$7.41 per share today, the lowest since November 2019. Compared with historical highs, the stock price is now down more than 75%.
Backed by Alibaba, Alibaba Health has gained strong gains in capital and traffic since its listing, and its revenue has grown rapidly. On the 24th, Alibaba Health released its interim results, with revenue of 9.36 billion yuan in the first half of the year, an increase of 31% year-on-year. However, the dilemma of "increasing revenue without increasing profits" is difficult to get rid of, and Ali Health turned from profit to loss in the first half of the year, with a net loss of 231.8 million yuan. Huge capital and other investments have not allowed Ali Health to usher in stable and sustained benefits in the short term.
Alibaba Health's current market value is around HK$100 billion, which has been cut by more than half compared with the previous market value of more than HK$300 billion.
Wind screenshot
The net loss in the first half of the year was 230 million yuan, and the stock price fell by more than 70% this year
Alibaba Health's revenue in the first half of the year was 9.36 billion yuan, an increase of 31% year-on-year. Alibaba Health said that its revenue continued to maintain rapid growth, thanks to the company's pharmaceutical self-operated business focusing on drug sales and services, and enriching the supply of pharmaceutical and health products with e-commerce platform merchants. The self-operated pharmacy operated under the "Alibaba Health" brand accounted for 64% of its drug revenue, and the revenue of the prescription drug business increased by 127.3% year-on-year.
Screenshot of the performance announcement
At the user level, as of September 30, 2021, the number of annual active consumers (consumers who have actually purchased products once or more in the Group's online self-operated stores in the past 12 months) reached 90 million. The number of monthly active users of the Yilu APP exceeds 2 million.
In terms of merchants and hospitals-doctors, Alibaba Health has served more than 25,000 merchants, an increase of 3,000 over half a year ago, and the number of SKUs in inventory exceeded 40 million, a rapid increase of 7 million compared with half a year ago. There are nearly 140,000 practicing physicians, licensed pharmacists and dietitians who have contracted with the Group to provide online health consultation services, an increase of more than 80,000 over the end of the previous fiscal year (including the number of Fawn TCM doctors).
During the reporting period, Alibaba Health lost 232 million yuan and the adjusted net loss was about 283 million yuan, and these two indicators turned from profit to loss year-on-year.
For the performance loss during the reporting period, Alibaba Health said that it was mainly due to the Group's increase in resource allocation in a series of innovative businesses (such as Medical Deer APP, local medical care, health insurance, etc.); during the reporting period, it invested in the technical research and development of the pharmaceutical self-operated business such as the refined operation of the pharmaceutical self-operation business, the user's follow-up diagnosis and prescription experience, and the compliance and safety of prescription drugs; and the Group increased investment in the tmall pharmaceutical platform and the brand mental construction (user habits) of Alibaba Health Pharmacy and the Group's self-operated business margin decreased due to the increase in the market share of online B2C drug sales, the acceleration of the layout of the prescription drug business and the increase in the corresponding market launch.
It is worth noting that in the secondary market, Alibaba Health's stock price reached its lowest point today: it has fallen by more than 75% compared with the highlight moment in February this year (HK$30.15).
After hitting a record high of HK$30.15 in February this year, Alibaba Health's overall downward wind screenshot
<b>Internet X Medical, can spending money bring good business? </b>
At the beginning of Alibaba's entry into the medical track, it attracted the attention of countless people. Backed by Alibaba, Ali Health can be described as "born with a golden key". From the perspective of development history, it can even be said that it is in the continuous "feeding" that Ali Health has gradually grown into China's Internet medical leader.
In 2014, Alibaba Group joined hands with Yunfeng Fund to subscribe for 4.423 billion shares placed by CITIC 21st Century for approximately HK$1.327 billion. After the transaction, Alibaba held a 54.33% stake in CITIC 21st Century, becoming its largest shareholder. Later, CITIC 21st Century changed its name to Alibaba Health, and the stock code remained unchanged.
CITIC 21st Century mainly operates the Electronic Supervision Network (PIATS) to provide electronic supervision information services to Chinese government departments, production enterprises, pharmaceutical industries and consumers. In short, CITIC 21st Century holds the "identity card" of each drug in its hand.
An important basis for the monetization of Internet enterprises is data. In 2016, Chen Yonghong, general manager of Guangdong Zhongsheng Pharmaceutical Co., Ltd., said in an interview with southern weekend reporters that pharmaceutical manufacturers do not know who their drugs are sold to, but Ali Health, the operator of the data platform, can launch mobile Internet products in a short period of time. "This trend shows that even if it is not directly profitable at the moment, Ali Health will use data to evolve a profit model."
Theoretically, through this transaction, Ali Health "acts as both a referee and a player". This caused alarm from all sides, and the electronic supervision code for drugs was soon suspended.
In the revenue composition of Alibaba Health, the part based on the original business of CITIC 21st Century is relatively small (2011 Annual Report - 2021 Interim Report)
So Ali Health turned to another track: selling drugs, and then investing a lot of resources to enter the market.
In 2015, Alibaba Health announced that it would acquire assets from Ali JK Investment and other places for HK$19.448 billion, and Ali Health would pay for the acquisition by issuing shares and convertible bonds. The announcement said that the target business injected into Alibaba involves an online trading platform for product sales in online large pharmacies, and said that it intends to expand the group into alibaba group's healthcare flagship platform.
In 2016, Alibaba Health acquired Guangzhou Five Thousand Years Pharmaceutical Chain Co., Ltd. for 16.8 million yuan, which was later renamed Asahi Health Pharmacy and launched the self-operated business of pharmaceutical e-commerce.
In 2017, Alibaba Health officially signed a share subscription agreement with Alibaba Group, in which Alibaba Group injected the HK$3.8 billion Tmall platform "Blue Hat" health food online business into Alibaba Health, further expanding the territory of Alibaba Health's pharmaceutical e-commerce business.
In 2018, Hong Kong-listed Alibaba Health announced that it had formally signed an agreement with Alibaba Group to acquire Tmall's medical devices and health products, adult products, medical and health services for approximately HK$1.828 billion in Alibaba Health shares, or HK$10.6 billion.
Ali's health map is getting bigger and bigger, but "burning money" has not been able to stabilize the speed of the blood-returning wheel.
After the listing, Ali Health lost money for many years. In fiscal 2021 alone, it turned into a downward trend, with a net profit attributable to the mother of 342 million yuan, compared with last year's loss of 15.7 million yuan. The performance of this interim performance may put a big question mark on the performance of the entire fiscal year.
Alibaba Health's revenue and net profit over the years (unit/100 million yuan) are integrated from wind
In recent years, the Internet has held hands on the medical track and attracted countless attention.
According to the "China Internet Development Report (2021)" released by the Internet Society of China, the scale of China's Internet medical and health market expanded rapidly in 2020, reaching 196.1 billion yuan, an increase of 47% year-on-year. As of December 2020, the number of online medical users in China was 215 million, accounting for 21.7% of the number of Internet users (989 million).
The "Report" predicts that the scale of China's Internet medical and health market will reach 283.1 billion yuan in 2021, an increase of 45% year-on-year, and the overall revenue scale of the big health industry will reach 7.4 trillion yuan, an increase of 7.2% year-on-year. The scale of China's medical informatization market exceeded 65 billion yuan, an increase of 18.6% year-on-year.
At the beginning of this year, the National Medical Insurance Bureau and the National Health Commission issued the Guiding Opinions on Promoting the "Internet +" Medical Insurance Service During the Prevention and Control of the New Crown Pneumonia Epidemic" The document points out that the cost of eligible "Internet +" medical services will be included in the scope of medical insurance payment. The Announcement on the Detailed Rules for the Supervision of Internet Diagnosis and Treatment (Draft for Solicitation of Comments) issued by the National Health Commission a few days ago made specific provisions on how to promote the development of "Internet + medical health" norms.
The broad prospects of the market and the continuous introduction of national policies have made Internet medical care often stand in the spotlight.
In May 2019, JD Health (6618. HK) was spun off from JD Group; on December 8 of the following year, JD Health was officially listed, and its market value on the first day exceeded that of Ali Health. On a more standardized and broader track, Internet medical care is becoming more and more lively.