Good News on Listing | Frost & Sullivan Assists CIC Consulting Limited in Successfully Switching from the Growth Enterprise Market to the Main Board (2176.HK)

During the process of this listing transfer, Frost & Sullivan mainly undertook the following tasks: helping the company accurately and objectively understand its positioning in the target market, using objective market data to discover, support, and highlight the company's competitive advantages, assisting the company, investment banks, and other intermediaries in completing relevant parts of registration documents (such as overview, competitive advantages and strategy, industry overview, business, and other important sections), helping the company communicate with the Hong Kong Stock Exchange and investors, and assisting investors and regulatory authorities in quickly understanding the market ecosystem and competitive landscape.

Consulting services are professional opinions provided by external experts in specific fields (such as business, education, law, compliance with regulations, human resources, marketing, finance, healthcare, science, or any other professional field).

Management consulting services aim to help organizations improve operational performance, mainly including organizational transformation, lean management, strategic management, operational improvement, marketing, growth, innovation, etc. Generally speaking, most management consultant service providers have their own methods or frameworks to identify problems and serve as the basis for providing professional opinions.

China's demand for professional services provided by management consulting service providers is increasing because these services help optimize enterprise operational efficiency. In the fierce market competition, improving organizational operational efficiency and enhancing the core competitiveness of organizations are crucial for enterprises.

The China management consulting service market has been growing steadily, increasing from 938 billion yuan in 2016 to 1011 billion yuan in 2020, with an average annual compound growth rate of 1.9%, mainly driven by macroeconomic development. Due to the outbreak of the COVID-19 pandemic, many consulting projects in 2020 were postponed to the second half of 2020, and payment dates were also delayed, resulting in negative growth in the market in 2020. However, driven by the demand of the "14th Five-Year Plan," governments at all levels and enterprises will hire management consulting service providers in the second half of 2020, which will maintain market growth. It is expected that after 2021, the market will return to stable growth. By 2025, the scale of the management consulting service market is expected to reach 1646 billion yuan.

China's demand for management consulting services is constantly increasing:In recent years, Chinese enterprises have increasingly emphasized strategic management and internal management. To make up for their lack of management experience, more and more enterprises have chosen management consulting companies, which have accumulated rich professional experience in organizational change, lean management, strategic management, operational improvement, etc. This helps enterprises adapt to the constantly changing external environment and ultimately achieve enterprise growth. In addition, many companies will hire market research consulting companies to better understand market changes and adjust their strategies according to market changes.

The gap between the development of traditional Chinese industries and the macroeconomy:In the past few decades, China's macroeconomy has experienced rapid growth, which has brought about sharp growth in many industries. Many participants in traditional industries lack internal diagnostic capabilities and organizational change capabilities and may not keep up with the development of the macroeconomy. The gap between the development of some traditional industries and the macroeconomy provides opportunities for management consulting companies, adding value to customers in different industries through their problem-solving skills. In addition, as China's macroeconomy enters the post-industrial era, knowledge-intensive industries such as management consulting services will become more important as economic support sectors.

The competition in China's management consulting service market is fierce, with low market concentration. As a highly professionalized and knowledge-intensive industry, the management consulting service industry values professionalism and reputation. Most of the top five companies in the management consulting service market are well-known consulting companies with rich experience and good reputation. In addition, due to the continuous changes in Chinese enterprise consulting needs, management consulting companies have begun to provide various other consulting services, such as consulting services related to big data, intelligence, automation, etc. In 2020, the total share of the top five companies in the China management consulting service market was about 11%.

Frost & Sullivan has rich research experience in industries related to professional services and data, assisting well-known enterprises in successfully listing on the capital market. Successful listing cases include Bairen Cloud (6608.HK), Qinhuai Data (CD.NASDAQ), Shengye Capital (6069.HK), CITIC Holdings (CIH.NASDAQ), etc.