Zhong Miao Holdings (01471.HK) was successfully listed on the Main Board of the Hong Kong Stock Exchange today, with CITIC Securities and Ping An Capital (Hong Kong) as joint sponsors.
Zhong Miao Holdings is an insurance agency service provider in Shandong Province, China, which is committed to distributing a variety of insurance products for corporate and family insurance users, covering property insurance products; life and health insurance products; accident insurance products; and motor insurance products. In 2017, the Company acquired Haier Insurance Agency from Haier Group and became its appointed insurance agency service provider to handle and manage all insurance-related matters in China for Haier Group.
本次众淼控股香港IPO引入基石投资者包括洪泰国际三号有限合伙基金(“洪泰”)及The Reynold Lemkins Group (Asia) Limited(“Reynold Lemkins”)。
Today, Zhongmiao Holdings successfully landed in the Hong Kong stock market, and the "Haier Department" gained the seventh listed company in addition to Haier Smart Home, Haier Electric, Haier Biotechnology and other companies, which also means that Zhongmiao Holdings has become the first share in the domestic insurance intermediary industry to land on the Hong Kong Stock Exchange.
At the opening of today, Zhongmiao Holdings rose 3.57% to HK$7.25 per share, with a market value of HK$1.024 billion.
Synthesis | Company Announcement Prospectus Edit | Echo
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Zhong Miao Holdings is an insurance agency service provider in Shandong Province, China, which is committed to distributing a variety of insurance products for corporate and family insurance users, covering property insurance products; life and health insurance products; accident insurance products; and motor insurance products.
In 2017, the Company acquired Haier Insurance Agency from Haier Group and became its appointed insurance agency service provider to handle and manage all insurance-related matters in China for Haier Group. For the years ended December 31, 2021, 2022 and 2023 and for the four months ended April 30, 2023 and 2024, revenue attributable to or related to Haier Group accounted for approximately 25.3%, 32.0%, 25.5%, 18.8% and 23.1% of the Company's total revenue, respectively.
According to Frost & Sullivan, China's insurance intermediary industry continues to grow and will maintain a steady growth trend, and the industry's underwriting is expected to grow at a CAGR of 12.8% between 2024 and 2028 to reach RMB1,505.5 billion in 2028.
Zhong Miao's total revenue increased from RMB120 million in FY2021 to RMB174 million in FY2023, at a CAGR of 20.4%, and from RMB53.4 million in the first four months of 2023 to RMB58.6 million in the first four months of 2024.
Zhong Miao Holdings works with different industry players, including insurance company partners (who are the company's customers), insurance agents and strategic channel partners, to promote and distribute insurance products from insurance company partners to corporate and home insurance users. Through the Company's sales channels, the Company promotes and distributes insurance products underwritten by insurance companies to insurance users, and receives commissions from insurance companies after successful purchase of insurance products by insurance users.
The company's services cover the major phases of the insurance business, including assisting with risk assessment and product selection, policy confirmation, premium payment, policy administration and insurance claims.
Zhong Miao Holdings' sales channels are mainly offline, including sales through insurance agents (the company engages them to promote and distribute insurance products mainly to the company's home insurance users, and the company will pay a commission after the insurance users successfully purchase the insurance products); Referrals from strategic channel partners (through which the Company refers a large number of corporate and home insurance users, and the Company will pay the referral fee after the insurance users successfully purchase insurance products); and direct sales. The company provides insurance agency services to insurance company partners in the upstream to expand its insurance user base; Downstream, the Company distributes insurance products to corporate and home insurance users and enhances their user experience.
During the Track Record Period, the Company has connected more than 70 insurance companies, including the top three insurance groups in China (in terms of market capitalization), as customers of the Company; It has connected insurance agents covering Shandong, Hebei, Henan and Jilin provinces; 20 strategic channel partners have been connected; and the Company has distributed insurance products to over 20,000 corporate insurance users and 368,000 home insurance users.
Since its establishment in 2017, Zhongmiao Holdings has developed online platforms, including the "Enterprise Insurance Interactive Service Platform", the company's "Quanzhang" APP, the company's WeChat official account and WeChat mini-program "Quanzhangjiake Claim Center", to improve the user experience of insurance users and provide comprehensive service support for insurance agents. In FY2021, FY2022, FY2023 and the first four months of FY2024, revenue attributable to insurance agency business amounted to RMB116 million, RMB131 million, RMB156 million and RMB54.8 million, respectively.
In view of the inherent commonalities between the digital solutions developed by the Company for the insurance agency business and the digital solutions required by the customers, the Company leverages the IT technology and expertise accumulated over the years to expand and develop the Company's IT services business. The company designs and develops digital solutions based on the needs of its customers, and provides IT services to various players, including companies in the insurance industry as well as companies from different industries. In FY2021, FY2022, FY2023 and the first four months of FY2024, revenue attributable to IT services amounted to RMB1.3 million, RMB15.0 million, RMB15.8 million and RMB3.2 million, respectively.
Given the insurance user base acquired by the Company from its insurance agency business, the resulting cross-selling opportunities have led the Company to provide advisory services, including human resources consulting services and marketing and promotion services, which are gradually becoming one of the Company's business segments. Specifically, the company advises clients on human resource management and recruitment strategies, and provides direct recruitment services to identify, attract and identify suitable talent for clients. Based on the company's marketing and promotion capabilities and the insurance user base that the company has accumulated in the insurance agency business, the company also provides marketing and promotion services to customers, including the design of promotional materials and advertisements. In FY2021, FY2022, FY2023 and the first four months of FY2024, revenue attributable to consulting services was RMB2.7 million, RMB2.7 million, RMB2.5 million and RMB0.6 million, respectively.
China's insurance intermediary industry continues to grow. According to Frost & Sullivan, China's insurance intermediary industry will maintain a steady growth trend, and the industry's underwriting size is expected to grow at a CAGR of 12.8% from 2024 to 2028, reaching RMB1,505.5 billion in 2028.
As described in the data and insights at the end of 2022 (from the latest China Insurance Yearbook published in December 2023), China's insurance intermediary industry presents a highly competitive and highly fragmented market landscape. As of the end of 2022, there were 2,215 insurance intermediaries in China. At the same time, as insurance intermediary licenses are recognized at the national level and are not subject to geographical restrictions, competitors from other provinces are also competing for market share.
The funds raised in the Hong Kong IPO of Zhongmiao Holdings will be used to develop the company's insurance agency business in the next three years; In the next five years, it will be used to improve the company's IT service products and R&D capabilities; Seek prudent investments in the insurance intermediary and fintech industries and acquire two to three target companies that can complement or create synergies with the company's existing business, so as to further accelerate the company's business development and enhance the company's competitiveness. The Company also intends to use the Company's internal resources (including cash on hand and withdrawals of time deposits at maturity) of approximately RMB100 million to fund the above investments and acquisitions to further provide the Company with more options; and for general working capital and general corporate purposes.