New Stock News | Xinde Technology files with Hong Kong Stock Exchange as the ninth-ranked domestic manufacturer in the Chinese animal healthcare market.

According to the disclosure by the Hong Kong Stock Exchange on February 16th, Shandong Xinde Technology Co., Ltd. (referred to as Xinde Technology) has submitted its listing application to the main board of the Hong Kong Stock Exchange, with Guosen Securities and CMB International serving as its joint sponsors. Company Overview According to the prospectus, established in 1999, the company is a leading animal health care enterprise in China. The company is mainly engaged in the research, development, production, and sales of a full range of animal health care and related products, including veterinary biological products (such as vaccines, antibodies, transfer factors, etc.), traditional Chinese veterinary medicines, chemical drug formulations, animal feed, and feed additives, enabling the prevention, diagnosis, treatment, and control of diseases in poultry, livestock, aquaculture animals, and pets. Based on data from Zhoushi Consulting, as of the revenue in 2024, the company ranks ninth among domestic manufacturers in the Chinese animal health care market and is among the top three in the Chinese poultry and veterinary biological products market. The company's business model focuses on two core drivers: (i) providing precise disease control solutions to customers. This involves a service system of precise epidemiological investigations, custom solutions, and precise evaluations. The company identifies epidemic strains and their variations promptly and accurately through precise epidemiological investigations, develops customized solutions to address epidemic strains, and continuously tracks clinical efficacy through precise evaluations; (ii) providing high-quality and cost-effective products through innovation and production capacity. During the reporting period, the company invested 1.1 billion RMB to support the construction of advanced manufacturing capacity and continued to invest in innovative research and development. As of September 30, 2025, the company has established four production bases in Shandong, Beijing, and other places, with 34 production lines all passing the new version of the GMP certification for veterinary medicines. The company's product line enables it to have the production capacity to provide comprehensive solutions for controlling animal diseases, covering preventive and therapeutic products, including biological products (such as vaccines, antibodies, transfer factors), traditional Chinese veterinary medicines, and chemical drug formulations. According to data from Zhoushi Consulting, there are currently over 1,500 veterinary drug manufacturers in China, leading to intense competition in the animal health care industry. The company competes with other animal health care product manufacturers, providing solutions for the prevention, diagnosis, treatment, and health management of animal diseases. In 2024, the market size of the Chinese animal health care industry reached 68 billion RMB. According to data from Zhoushi Consulting, based on revenue in 2024, the company ranks ninth among domestic manufacturers in the Chinese animal health care market, with a market share of 1.4%. The company's competitive advantage lies in its position as a leading animal health care company in China, establishing strong relationships with farms. Through its precise disease control model, the company has demonstrated its international expansion capabilities and benefits from advanced research and development capabilities, world-class production capacity, a visionary management team, and strategic support from Fortune Global 500 shareholders. The company's ability to maintain competitiveness and continued success will depend on providing a one-stop precise disease control service model, strengthening customer cooperation relationships, developing leading products based on technology and market insights, expanding overseas markets with long-term potential, and promoting pet health care business. Financial Information Revenue In the nine months ending on September 30 in 2023, 2024, and 2025, the company's revenue was approximately 985 million RMB, 982 million RMB, and 877 million RMB, respectively. Profit In the nine months ending on September 30 in 2023, 2024, and 2025, the company's net profits were 34.763 million RMB, 28.118 million RMB, and 55.671 million RMB, respectively. Gross Profit Margin In the nine months ending on September 30 in 2023, 2024, and 2025, the company's gross profit margins were 49.7%, 50.8%, and 55.3%, respectively. Industry Overview The global animal health care industry market size was 40.2 billion USD in 2019, growing to 51.1 billion USD by 2024, with a compound annual growth rate of 4.9%. It is expected that by 2034, the market size will grow to 85.8 billion USD with a compound annual growth rate of 5.3%. The market size of the Chinese animal health care industry was 50.9 billion RMB in 2019, growing to 68 billion RMB by 2024, with a compound annual growth rate of 6.0%. It is projected that by 2034, the market size will grow to 141 billion RMB with a compound annual growth rate of 7.6%. The Chinese animal health care market can be further divided into veterinary biological products, chemical drug formulations, traditional Chinese veterinary medicines, and raw materials for veterinary use. Drivers of the Chinese Animal Health Care Industry Difficulty in controlling animal diseases. In recent years, with the globalization of the world economy and frequent cross-border logistics and human movements, the risks of the occurrence and spread of animal diseases have increased, leading to a relatively higher demand for epidemic prevention and control by breeding enterprises. Large-scale epidemics will result in a significant short-term increase in the cost of prevention and control. According to the National Development and Reform Commission's compilation of cost-benefit assemblies for scale breeding, due to the impact of African swine fever at the end of 2018, from 2018 to 2020, the medical and epidemic prevention costs per pig in scale breeding increased by 26.9% and 10.6% respectively, reaching 20.21 RMB, 25.65 RMB, and 28.37 RMB. Obvious trend towards large-scale farming. With high breeding densities, under the model of large-scale farming, the risks of animal diseases and epidemic transmission increase. Large-scale farms tend to purchase efficient animal health care solutions. The average medical and preventive expenses per pig in large-scale farms are higher than in free-range farming. In 2019, the proportion of scaled pig farming in China was only about 50%, but it had reached 70% by 2024. Increasing demand for pet companionship in China. With the continuous reduction in the size of Chinese households, there are now over 125 million single-person households in China, accounting for about 20%, as well as an accelerating aging population, with about 15% being 65 years old or older. The demand for pets as emotional substitutes and companions has significantly increased. In 2022, China's total fertility rate was 1.05, ranking second to last among major countries. Chinese pet owners have shown a significantly higher level of concern over the health of their pets, leading to a gradual increase in demand for drugs and treatments for internal and geriatric diseases in pets, promoting the accelerated development of pet medical care and other segmented fields. Board of Directors Information The board of directors currently consists of nine directors, including four executive directors, two non-executive directors, and three independent non-executive directors. The board members serve for a three-year term, with the possibility of consecutive re-election, and are responsible for and have general management and operational rights. Equity Structure As of the latest feasible date (February 7, 2026), Mr. Li Zhaoyang can exercise approximately 45.08% of the company's voting rights through (i) his direct holdings of 34,270,874 shares and (ii) the 25,199,100 shares held by Inter International. Inter International is a limited company registered in the British Virgin Islands, wholly owned by Hong Kong Xinde, which is fully owned by Mr. Li Zhaoyang. Following the completion of the compilation (assuming it is not exercised), Mr. Li Zhaoyang, together with Inter International and Hong Kong Xinde, will have the right to exercise approximately X% of the company's voting rights. Therefore, Mr. Li Zhaoyang, Inter International, and Hong Kong Xinde will constitute a controlling group of shareholders according to the listing rules. Intermediary Team Joint Sponsors: Guosen International Financing Limited, CMB International Financing Limited; Legal Advisors: Ho Wei Law Firm, King & Wood Mallesons; Joint Sponsors and Compilers of Legal Advisors: Jia Yuan Law Firm, Jia Yuan Law Firm; Auditors and Reporting Accountants: Ernst & Young Certified Public Accountants; Industry Consultant: Zhoushi Enterprise Management Consulting (Shanghai) Co., Ltd.; Compliance Advisor: CMB International Financing Limited.