Ali Health investors are preparing for the first financial statement of 2020, and they have priced the firm’s stocks generously over the COVID-19-related expectations.
► Ali Health investors have high hopes for the first quarter of 2020 as the firm pushes pharmaceutical e-commerce.
► Its stock price hit a historic high on May 15 on the Hong Kong Stock Exchange.
Stocks of Alibaba's Hong Kong-listed healthcare arm, Ali Health, have hit HKD 21.05, a historic peak since its IPO, leaving industry watchers wondering whether the firm will really satisfy expectations.
The firm, Alibaba Health Information Technology (0241:HKEX), has doubled its stock price since the beginning of the COVID-19 outbreak in China in December 2019, primarily because of the sudden practical need that arose after the pervasive virus emptied hospitals and pharmacies of patients who needed primary care.
The firm's largest revenue stream, the pharmaceutical self-operated business segment, is expected to grow substantially due to coronavirus-related consumer-side changes. Notably, the firm doesn’t generate any major portion of its revenues through online diagnosis – or online care, one might say – yet its contribution is rising fast in total revenues, and an asymmetric jump is expected in the first quarter of 2020, particularly in the online care segment.
“The data we have received from the National Health Commission of the People’s Republic of China indicated a staggering 20-fold jump in the number of online diagnoses and over 10 times more prescriptions amongst some online healthcare platforms since the outbreak,” said the CEO of Tencent Trusted Doctors to EqualOcean in a previous interview about China's online health ecosystem.
Read this interview article to discover our exclusive insights and data on the Chinese online health field.
For the traditional players – offline pharmacies and drug delivery giants – the investment atmosphere was not as optimistic as it is was in ‘innovative ones.’ or that so-called online health. Pharmaceutical services stocks that have mainly been generating revenues through offline services, such as Tycoon Group Holdings Ltd (3390:HKEX) and Dawnrays Pharmaceutical Holdings Ltd (2348:HKEX) have lost their value slightly since the beginning of the outbreak, while Ali Health and Ping An Good Doctor (1833:HKEX) rallied in the same period.
The firm is expected to release its first financial results of 2020 on May 27.