| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 4.50 | -39 |
| Intrinsic value (DCF) | 3.46 | -53 |
| Graham-Dodd Method | n/a | |
| Graham Formula | n/a |
111, Inc. (NASDAQ: YI) is a leading integrated online and offline healthcare platform in China, operating through B2B and B2C segments. The company specializes in the sale of medical and wellness products, including prescription and over-the-counter drugs, nutritional supplements, medical devices, and personal care items. Through its digital ecosystem, 111, Inc. provides value-added services such as online consultations, electronic prescriptions, and supply chain solutions, catering to pharmacies, pharmaceutical distributors, medical professionals, and consumers. The company also operates 14 offline retail pharmacies under the Yi Hao Pharmacy brand, enhancing its omnichannel presence. With a strong focus on digital healthcare innovation, 111, Inc. leverages its platform to streamline procurement, logistics, and data integration, positioning itself as a key player in China's rapidly growing e-healthcare market. Headquartered in Shanghai, the company continues to expand its footprint in a sector driven by increasing healthcare demand and digital transformation.
111, Inc. presents a high-risk, high-reward investment opportunity in China's burgeoning digital healthcare sector. The company benefits from strong revenue growth (CNY 14.4B in latest reporting) and a scalable platform model, but remains unprofitable (net loss of CNY 64.7M). Its integrated B2B and B2C approach provides diversification, while its asset-light model supports positive operating cash flow (CNY 263M). Key risks include intense competition, regulatory scrutiny in China's pharmaceutical sector, and persistent losses. The stock's low beta (0.473) suggests relative stability versus broader market swings, but investors should monitor the company's path to profitability and ability to scale its value-added services.
111, Inc. competes in China's fragmented digital healthcare market by combining wholesale distribution (B2B) with direct-to-consumer (B2C) capabilities - a hybrid model that differentiates it from pure-play competitors. The company's competitive advantage stems from its integrated supply chain, which connects pharmaceutical manufacturers with over 300,000 retail pharmacies while also serving end consumers. Its proprietary technology platform enables efficient inventory management and logistics, critical in a market where pharmaceutical distribution remains highly regionalized. However, 111, Inc. faces scaling challenges against better-capitalized rivals like JD Health and AliHealth, which benefit from parent company ecosystems. The company's smaller offline pharmacy footprint (14 stores) limits physical touchpoints compared to traditional chains. Its focus on value-added services (e-prescriptions, data analytics) creates sticky customer relationships but requires continued R&D investment. Regulatory tailwinds from China's 'Internet+ Healthcare' policies support growth, but the company must navigate complex pharmaceutical licensing requirements that create barriers to entry while constraining margin expansion.