Meinian Onehealth plans to open 200 more medical examination centres in China this year, and expand in Hong Kong

Meinian Onehealth Healthcare Holdings, China’s largest medical examination centre operator, plans to open another 200 more centres in the country this year, adding to the more than 400 outlets it has nationally, the company’s founder and chairman Yu Rong said on Wednesday.

It also plans to expand its presence in Hong Kong.

“We will have some good news to announce very soon, within this year,” said Yu, without elaborating.

The Shenzhen-listed but Shanghai-based company has a market capitalisation of around 74 billion yuan (US$11.5 billion).

It provides general medical examinations, disease screening and services such as doctor referrals and traditional Chinese preventive health services to individual and corporate customers.

According to Qianzhan Industrial Research Institute, the country’s preventive health care market is expected to generate 200 billion yuan in revenue this year, amid an ageing population.

It already has 158.31 million people aged over 65 – more than the population of Russia.

Founded in 2004, Meinian is among around 200 Chinese large caps to be included in MSCI’s major emerging-market indexes, a key index for global fund managers to decide where to invest, from June 1.

Shares in the company have ballooned 94.7 per cent since May 2017.

Aware of the huge potential of China’s thriving future health care market, US buyout fund Carlyle Group, which manages around US$201 billion worth of assets, bought a 13.5 per cent stake in the company in 2012, while it is also backed by major Chinese insurers such as Pingan Insurance and China Taiping.

China’s preventive health care sector remains highly fragmented, but Meinian has traditionally competed head-to-head with two other major rivals: Beijing-based Ciming Health Checkup Management and iKang Healthcare Group.

The company bought Ciming last year, after it finally got the green light from Chinese regulators on a deal that had raised monopoly concerns.

It continues expanding largely through setting up joint ventures with foreign medical service providers.

Its latest move came on Wednesday, when it struck a deal with Australian medical equipment supplier Compumedics Limited, to launch a joint venture in the mainland in a deal worth HK$67 million (US$8.54 million).

It also signed an agreement with Switzerland-based health care giant Novartis’s China branch in early May, to explore opportunities in curing ophthalmology and central nervous system diseases.

The company reported a whopping 120.7 per cent growth in revenue to 1.2 billion yuan in the first quarter of this year, but net profit fell 7 per cent.

The company said this time of year is considered the off-season for the health examination industry in China.