On the evening of October 13, 160 HEALTH (HK: 02656) released a voluntary business progress announcement, stating that its indirectly wholly-owned subsidiary, Shenzhen 160 Network Technology Co., Ltd., had formally signed its first sales contract with the computing power partner with which it had previously signed a framework agreement, with a contract value of approximately RMB 42 million.
The next day, the company's share price rose by more than 17% at one point during intraday trading, with single-day turnover exceeding HKD 86 million, and speculative sentiment heating up rapidly.
On September 16, 2026, 160 HEALTH (HK: 02656) first disclosed that it had signed a strategic cooperation framework agreement with the computing power enterprise, with an estimated total cooperation amount of RMB 650 million, on the very day that a large-scale lock-up release of restricted shares occurred on the first anniversary of the company's listing.
From the simultaneous release of the RMB 650 million computing power positive news on the lock-up release date to the landing of the RMB 42 million first order less than a month later to stimulate the share price again, the timing of this series of actions precisely fits the window for capital operations.
Is the AI computing power narrative the company's second growth curve, or is it market speculation aligned with capital demands?
Multiple Doubts Behind the RMB 650 Million Framework Agreement: The Quality of the Computing Power Business Remains to Be Tested
On September 16, 160 HEALTH (HK: 02656) first disclosed that it had signed a strategic cooperation framework agreement with a computing power enterprise, with an estimated total cooperation amount of RMB 650 million.
According to the framework agreement announcement, the agreed cooperation period between the two parties is only one year, from September 16, 2026 to September 15, 2027.
The announcement explicitly stated that "this framework agreement is not legally binding, and the approximately RMB 650 million cooperation scale is an estimated figure and not a rigid cooperation commitment," and that subsequent specific orders require the partner to issue procurement demand notices based on its own project implementation progress, after which both parties will negotiate configuration, price, and delivery cycle, and the agreement will only take effect after a formal procurement contract is signed.
It can be seen that this agreement is essentially only a letter of commercial intent. The estimated amount of RMB 650 million has neither a corresponding procurement batch timetable nor a minimum purchase volume commitment, and the degree of project advancement depends entirely on the partner.
For 160 HEALTH (HK: 02656), whose annual revenue scale is only around RMB 650 million, whether this large order, equivalent to its full-year revenue volume, can ultimately be realized remains uncertain.
At the same time, in both announcements, 160 HEALTH (HK: 02656) never disclosed the specific company name of the partner. For a major cooperation with an estimated scale of RMB 650 million, deliberately omitting the full name of the counterparty is inconsistent with the disclosure practices for major transactions of Hong Kong-listed companies and also weakens the authenticity and credibility of the cooperation.
From a commercial logic perspective, 160 HEALTH (HK: 02656) had never previously ventured into computing power hardware-related business, and its core team all has backgrounds in internet healthcare and pharmaceutical distribution.
Therefore, the supply of computing power infrastructure is nothing more than purchasing hardware products such as GPU servers, switches, and storage devices from upstream manufacturers, assembling and debugging them, and delivering them to downstream customers.
The partner itself is a professional manufacturer focused on the enterprise-level computing power infrastructure field, providing equipment leasing and AI cloud computing power services, and has no connection to medical scenarios.
Generally speaking, such enterprises should directly establish direct procurement cooperation with upstream hardware manufacturers to obtain lower procurement costs and more stable delivery capabilities.
But in the end, it chose to procure computing power infrastructure through an internet healthcare company, and the commercial logic chain in between is not smooth.
It should be noted that in the Hong Kong stock market, such large framework agreements have become a commonly used tool for small and mid-cap companies to speculate on themes.
Since framework agreements are not major transactions subject to mandatory disclosure under the listing rules, companies can voluntarily publish them and bear no legal responsibility for the fulfillment of the estimated amounts, and even if nothing is ultimately realized, they will not be subject to regulatory accountability.
The flexibility of information disclosure precisely provides a breeding ground for concept speculation.
In addition, the first RMB 42 million sales contract that landed did not provide information such as the specific products or business, delivery cycle, or gross margin level, and it is difficult to judge its actual contribution to the company's profitability based on the amount alone.
Referring to the profitability level of similar system integration businesses, the gross margin of computing power infrastructure integration and O&M services is usually between 10% and 30%, far lower than the over 80% gross margin of 160 HEALTH's (HK: 02656) digital healthcare business.
Even if the RMB 42 million order fully recognizes revenue during the period, the gross profit contributed may be relatively limited, and the impact on the company's full-year performance would be minimal.
Four Consecutive Years of Losses and Continuous Net Cash Outflow
Behind 160 HEALTH's (HK: 02656) cross-border move into the computing power sector to create a "second growth curve" is the company's predicament of weak growth in its main business and high debt pressure.
160 HEALTH's (HK: 02656) business includes two major segments: pharmaceutical and health product sales and digital healthcare solutions. From the revenue structure perspective, the company's revenue is highly dependent on the low-margin pharmaceutical distribution business, while the high-margin digital healthcare business is relatively small in scale.
According to the 2025 annual report data, the company achieved total annual revenue of RMB 652 million, of which pharmaceutical and health product sales revenue was RMB 443 million, accounting for 68%, but the gross margin of this business was only about 1.4%.
Digital healthcare solutions revenue was RMB 209 million, accounting for 32%, with a gross margin of about 80%, making it the company's core profit source, but its scale is limited and insufficient to cover overall operating costs.
From the performance in recent years, from 2022 to 2025, the company achieved revenue of RMB 526 million, RMB 629 million, RMB 621 million, and RMB 652 million, respectively, while net profit attributable to shareholders during the same periods was -RMB 120 million, -RMB 106 million, -RMB 108 million, and -RMB 72.986 million, respectively, remaining in a loss-making state for four consecutive years, with cumulative losses exceeding RMB 400 million.
In the first half of 2026, the company achieved revenue of RMB 319 million, a year-on-year increase of 9.7%, and a profit of RMB 1.676 million during the period, turning a loss into a profit.
However, the realization of profitability largely depended on expense compression. During the reporting period, the company's R&D expenses decreased by 11.5% year-on-year, a net decrease of about RMB 2.1 million.
In terms of cash flow, from 2023 to 2025, the company's net cash flow from operating activities was -RMB 65 million, -RMB 56 million, and -RMB 114 million, respectively, negative for three consecutive years with the outflow scale expanding; in the first half of 2026, net operating cash flow further dropped to -RMB 53.03 million, nearly 10 times larger than -RMB 5.38 million in the same period last year, with the cash outflow pace significantly accelerating.
Accompanying the deterioration of cash flow was the rapid rise in accounts receivable. As of the end of June 2026, the company's accounts receivable balance reached RMB 266 million, a year-on-year increase of 68.57%, accounting for more than 83% of operating revenue during the same period. The accounts receivable turnover days also rose all the way from 51.25 days in 2022 to 132.58 days in the first half of 2026.
Long-term losses and cash flow bleeding have caused 160 HEALTH's (HK: 02656) balance sheet to remain under pressure, with debt levels staying high.
As of the end of June 2026, the company's total assets were RMB 852 million, total liabilities were RMB 618 million, and the asset-liability ratio was as high as 72.57%.
From the liability structure perspective, the company's liabilities are mainly short-term operating liabilities and short-term borrowings, with total current liabilities of approximately RMB 600 million.
The company's book cash and cash equivalents are approximately RMB 400 million, and its short-term debt repayment capacity is relatively weak.
At the same time, a large portion of the cash comes from listing financing. With operating cash flow continuously negative, the company is in effect using financing funds to repay debt and support operations, with a high degree of dependence on external financing.
Positive News Coincides with the Lock-Up Release Window: Is the Computing Power Story Really a Market Cap Management Tool?
From the timing of the announcement releases, the pace of 160 HEALTH's (HK: 02656) computing power positive news highly overlapped with the time windows for restricted share lock-up releases and shareholder reductions.
On September 16, 2026, 160 HEALTH (HK: 02656) completed one full year since its listing on the Hong Kong Stock Exchange, which was also the lock-up release date for the company's pre-IPO shareholder restricted shares.
Data shows that the cumulative number of shares released from lock-up this time was approximately 267 million shares, a massive scale.
On the day of the lock-up release, the company simultaneously released the blockbuster positive news of the RMB 650 million computing power framework agreement.
The next day, the company's share price opened nearly 15% higher in the morning, reaching an intraday high of HKD 8.88, and its market value once recovered to more than HKD 2.6 billion.
But the share price then quickly fell back, finally closing at HKD 7.55 that day, leaving a long upper shadow, with turnover expanding to HKD 142 million.
At the same time, on the first trading day after the lock-up release, there was already insider selling.
According to Hong Kong Stock Exchange disclosure of interests information, on September 18, company executive director Huang Lang sold 2,615,500 shares on the market at an average price of HKD 5.68 per share, cashing out approximately HKD 14.856 million. After the reduction, his shareholding ratio dropped from 0.88% to 0.13%, an almost complete liquidation-style reduction.
In addition to the executive director's reduction, the company's co-founder and former executive Wang Ming also continued to reduce his shares after the lock-up release.
Data shows that Wang Ming continued to sell through Ming Holdings Limited, which he controls, causing the shareholding ratio of persons acting in concert with the company's actual controller Luo Ningzheng to drop from 33.01% to 29.86%.
After the brief speculation, the company's share price quickly returned to a downward channel.
From the high of HKD 8.88 on September 17 to the closing price of HKD 2.82 on October 14, the share price fell by more than 65% in less than a month, with market value evaporating by more than HKD 1.6 billion. All the gains brought by the previous computing power positive news were given back, and it even hit a new low since listing.
After the RMB 42 million first order announcement was released on the evening of October 13, the share price again surged and then fell back the next day, reaching an intraday high of HKD 3.335 but closing back at HKD 3.03, also leaving a long upper shadow.
In summary, 160 HEALTH's (HK: 02656) computing power order may be more like a "market cap management tool," and investors should perhaps still view it rationally.
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