Hong Kong-based health and beauty retailer Lung Fung Group has concluded its public share offering. Market data indicates the offering attracted significant investor interest.

The public offering period ran from May 28 to June 2, 2026. According to market sources, margin financing for the retail tranche reached approximately HKD 25.6 billion. Based on the public offering size of HKD 79.75 million, this represents an oversubscription level of about 320 times.

The international placement portion of the offering is also reported to have been fully subscribed.

Lung Fung Group (HKEX: 02290)

The company plans a global offering of 125 million shares. The Hong Kong public offering accounts for 10% of the total, with the international offering making up the remaining 90%. An over-allotment option of up to 15% of the total shares offered is also available.

The indicative price range is set between HKD 5.18 and HKD 6.38 per share. The minimum board lot size is 500 shares, requiring an initial investment of around HKD 3,222.17. The offering is expected to raise up to HKD 797.5 million in gross proceeds.

The company is scheduled to list its shares on the Hong Kong Stock Exchange on June 5, 2026. DBS Group Holdings Ltd. is acting as the sole sponsor for the listing.

Company Business Overview

According to its prospectus, Lung Fung Group is a leading chain retailer of cosmetics, health products, and pharmaceuticals in Hong Kong. The company operates 31 physical stores under the "Lung Fung" brand and maintains multiple online sales platforms, offering a wide range of value-for-money products.

Research from Frost & Sullivan indicates that for the 2025 fiscal year, Lung Fung Group ranked as the third-largest retailer of cosmetics, health, and pharmaceutical products in Hong Kong by retail sales, holding a 5.8% market share.

Specifically, the company was Hong Kong's largest pharmaceutical retailer by retail sales, with a 5.2% share of that market. By revenue, it was the third-largest retailer of pharmaceuticals and health products, commanding approximately a 4.2% market share.

Retail Network and Online Presence

The company's retail business is supported by a strategically located network of stores across Hong Kong. As of the latest practicable date, it operates 31 stores with a total usable floor area exceeding 123,000 square feet.

These stores are situated in key tourist and shopping districts, residential areas, and commercial office zones. The network comprises 6 stores on Hong Kong Island, 11 in Kowloon, and 14 in the New Territories, with most being street-level shops. Individual store sizes range from about 570 to 12,900 square feet, with an average area of over 4,180 square feet per store.

In addition to its physical presence, Lung Fung Group has established online sales channels, including an official website serving local Hong Kong customers and storefronts on major Chinese e-commerce platforms such as Tmall, WeChat Mini Program, and JD.com.

Financial Performance and Fund Usage

For the fiscal years 2023, 2024, and 2025, the company reported revenues of approximately HKD 1.094 billion, HKD 2.021 billion, and HKD 2.460 billion, respectively.

Net profit for the same periods was approximately HKD -27.14 million, HKD 145 million, and HKD 170 million.

The company intends to use the net proceeds from the offering for several purposes. Approximately 36.6% is earmarked for expanding and optimizing its physical and online sales networks.

About 3.5% is allocated for brand management and marketing, and another 3.5% is intended for expanding and upgrading its existing procurement offices and warehouses in Japan and South Korea.

A further 11.4% is designated for upgrading its information technology systems, while 20.0% is planned for repaying outstanding loans.

Around 15.0% is reserved for seeking selective strategic investments, acquisition opportunities, and developing strategic partnerships. The remaining 10.0% will be used for general working capital purposes.