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Alibaba Health Information Technology's stock surged jumped by the most in four months after the company reported a profitable first half, as the coronavirus pandemic raised awareness and fuelled demand for its goods and services.It made a net profit of 278.6 million yuan (US$42.4 million) in the six months ended September 30, compared with a loss of 7.6 million yuan in the same period a year earlier, according to a Hong Kong stock exchange filing late on Wednesday. It marked the first profitable report since the health care business was injected into the company in 2015.The improvement came from its direct sales business, where revenue surged by 76 per cent to 6 billion yuan. It contributed 84 per cent of the group revenue in the interim report.Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.Its online stores, which sell prescription and generic drugs, health supplements and skincare products, grew their customer base to 65 million users from 48 million on March 31. Customers can also get online consultation services. Direct sales accounted for about 84 per cent of the firm's revenue during the first half of the financial year.Its e-commerce platform on Tmall, on which some 18,000 merchants sell anything from drugs to contact lenses, health food and medical devices, also saw strong growth as gross merchandise volume grew 50 per cent to 55.4 billion yuan.Tmall is the Chinese business-to-consumer online retail platform operated by Alibaba Group, which owns 65 per cent of Alibaba Health. Alibaba Group is also the owner of the South China Morning Post.Alibaba Health jumped 7.6 per cent to HK$21.20 in Hong Kong, the biggest daily gain since July 21. The stock has risen 136 per cent this year after adding 42 per cent in market value in 2019. Which Hong Kong stocks have skyrocketed during the coronavirus pandemic?The pandemic has helped power demand for health care stocks. JD Health, the online-offline group controlled by JD.com, is currently seeking up to US$4 billion from a stock offering in Hong Kong. Alibaba Health itself raised US$1.3 billion through a follow-on share sale in August.Alibaba Health expects "plenty of room to grow" the pharmaceutical business on its Tmall platform, predicting that consumers will allocate a bigger budget to health care within household spending in the post-pandemic period.This year, it has deepened collaboration with leading pharmaceutical companies during the reporting period. It partnered with AstraZeneca in September to market the firm's anticancer drugs in its direct drugstores. It also started selling GlaxoSmithKline's chronic obstructive pulmonary disease medication in March.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.
Alibaba Health Information Technology said on Thursday it has signed a strategic cooperation agreement with Chinese coronavirus vaccine developer Sinovac Biotech. The two firms will jointly build a platform for coronavirus vaccine inoculation in the future, Alibaba Health said in Chinese social media platform Weibo, without giving further details. Sinovac's coronavirus vaccine candidate CoronaVac, being tested in final-stage large-scale trials in Brazil, Indonesia and Turkey, has already been given to tens of thousands of people via an emergency use program China launched in July.
Alibaba Health Information Technology has increased the size of its follow-on new share sale launched Tuesday night by 25 per cent, raising US$1.3 billion amid strong demand from investors.At US$1.3 billion, it is the largest ever follow-on share sale by a health care company in Hong Kong, surpassing CSPC Pharmaceutical Group's US$1.26 billion follow-on offering in April 2015, data from Refinitiv shows.The flagship health care platform of Alibaba Group Holding's initial 400 million new shares offer was raised by a quarter to 498.8 million, which stands as 3.85 per cent of the firm's outstanding share capital, according to a filing with the Hong Kong stock exchange on Wednesday.The share sale was priced at HK$20.05 each, at the low end of the tight indicative range set at HK$20.05 to HK$20.50 (US$2.59 to US$2.65). The final price represents a discount of about 8.03 per cent to Tuesday's closing price of HK$21.8.The offer was "multiple times" oversubscribed, according to a person familiar with the transaction.The company will use the proceeds to expand its pharmaceutical and medical services network, which received a major boost from the coronavirus pandemic in China."Online health care consultation services have had a significant positive social impact during the Covid-19 pandemic," said Alibaba Health Information Tech in the filing, adding it will continue to "give full play to its pharmaceutical e-commerce service capabilities" to reach millions of patients.Credit Suisse and Citigroup were the joint placing agents for the deal.Share placements launched by Hong Kong-listed biotech and pharmaceutical companies have surged this year. There were thirteen offerings between January and July, up from just three deals over the same period a year ago, according to data compiled by Refinitiv. Funds raised surged 75 times, to US$4.56 billion from US$60.2 million a year ago.During the peak of the Covid-19 pandemic in China, Alibaba Health partnered with Tmall to provide medical delivery services to patients with chronic diseases throughout the mainland. Tmall is a business-to-consumer online retail platform operated by Alibaba Group, which also owns the South China Morning Post.Alibaba Health Information Tech's shares were down 2.75 per cent at HK$21.2 by midday in Hong Kong. Year-to-date, the stock is up 135 per cent, more than doubling from HK$9 at the end of 2019.The Hang Seng Healthcare Index, which tracks 36 Hong Kong-listed health care related stocks, is up 39 per cent year-to-date, at 6565.39 points.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.