Economic Overview - China's GDP growth in Q2 was 5.2%, slightly above market consensus, with mixed economic activity data in June [1] - The average GDP growth for the first half of the year was 5.3%, leading to an upward adjustment of GDP growth forecasts for 2025/26 to 4.7% and 3.9% respectively [1] Focus Stocks - Didi received a "Buy" rating, with expectations of strong growth in its mobility business and advancements in autonomous driving, projecting a 12-month target price of $7.20 [4] - Anta's retail sales for 2025 are expected to align with forecasts, with a positive outlook for the second half of the year, maintaining a target price of HKD 117 [11] - MakeMy Trip is viewed as an attractive buy opportunity, with expectations of over 20% revenue growth starting in September, and a target price of $123 [12] - JD Health is favored over Alibaba Health due to higher sales growth trends and a target price of HKD 45.80, with a focus on its capital allocation strategy [13] Industry Focus - The market size for China's autonomous taxi sector is projected to reach $14 billion by 2030 and $61 billion by 2035, reflecting a 20% and 31% increase from previous estimates [5] - Improvements in chip supply are expected to positively impact China's cloud computing and data center sectors, with a cautious outlook on capital expenditures for 2025 [8]

Core Insights - JD Health and Bayer Health Consumer signed a strategic cooperation agreement for the promotion of Daxin® Lactulose, aiming to enhance the digestive health market in China [2][3] - The prevalence of chronic constipation in China is increasing, with an overall rate of 10.9%, and adult constipation rates reaching 13.4% from 2014 to 2018 [2] - Sales of laxative products in China grew from 4.573 billion to 7.683 billion yuan between 2017 and 2022, indicating a steady demand [2] Company Collaboration - JD Health will leverage its online channel advantages and full-channel business layout to enhance consumer awareness of Daxin® Lactulose [3] - The collaboration aims to expand offline retail channels and create a new ecosystem for online and offline coordinated growth [3] - Bayer Health Consumer values JD Health's integrated online and offline layout, seeking to provide quality products and services to more users [3] Product Features - Daxin® Lactulose is designed for long-term use, providing rapid clinical effects within 1-2 days for patients with chronic functional constipation [2] - The product has dual functions in the intestines, helping to lubricate and soften stools while promoting the growth of beneficial bacteria [2]

Core Insights - JD Health has entered the medical beauty sector with the opening of its first self-operated clinic in Beijing Yizhuang, named "JD Medical Beauty (Yizhuang Store)" [1] - This marks the first physical store launch after the establishment of JD Health's medical beauty subsidiary in March 2023, with a second store set to open on September 30 in Beijing's Guomao area [1] - The Yizhuang store is integrated within JD Health's comprehensive outpatient department and offers popular light medical beauty services such as skin whitening, water light beauty, wrinkle removal, and anti-aging treatments [1] - The JD Medical Beauty services are accessible through the JD App, allowing users to search for "medical beauty" and navigate to the dedicated channel for services [1] - JD Medical Beauty has also launched a WeChat mini-program for additional accessibility [1] Trademark Registration - Beijing JD 360 Degrees E-commerce Co., Ltd. has applied for multiple "JD Medical Beauty" trademarks, covering international classifications such as advertising sales, medical gardening, and scientific instruments, with many trademarks currently awaiting substantive examination [4]

Group 1 - Goldman Sachs forecasts that JD Health will maintain robust revenue in Q2 this year while keeping spending disciplined, reaffirming a "buy" rating due to JD Health's strong position in the pharmacy and medical services sectors [1] - JD Health is rapidly building front warehouses in first-tier cities, with approximately 40 to 50 warehouses established nationwide as of mid-year, aiming for about 200 by the end of 2025, in line with the group's instant delivery plan [1] - Despite intense market competition, Goldman Sachs believes that the pharmaceutical category is difficult to drive sales through promotions, as consumers prioritize quality and variety [1] Group 2 - Goldman Sachs expects JD Health's sales to grow approximately 18% and operating profit to increase about 5% in Q2 2025, considering the gradual increase in investments [2] - The company’s guidance for flat profit growth in FY2025 has accounted for significant investment increases in the second half of the year [2] - Based on improved profit margin assumptions, Goldman Sachs' profit forecast for JD Health in 2025 is 6% higher than market consensus, while net profit estimates have been raised by 1% to 2% due to disciplined cost and expense control [2]

Core Insights - JD Health has officially launched its first self-operated medical beauty clinic named "JD Medical Beauty (Yizhuang Store)" on July 14, marking its entry into the offline medical beauty market [1] - The clinic offers four main services: skin whitening, water light beauty, wrinkle removal, and light-based anti-aging treatments [1] - JD Health has been gradually entering the medical beauty sector since 2021, collaborating with over 2,000 certified institutions and establishing direct supply partnerships with major manufacturers [2][3] Company Developments - The Yizhuang store has been in trial operation for over two months, initially serving JD employees before opening to the public [1] - JD Health plans to open a second flagship store in Beijing's Guomao Wantong Center by September or October [1] - In March 2023, JD Health established a subsidiary focused on medical beauty services and applied for the "JD Medical Beauty" trademark [2] Market Context - The Chinese medical beauty market is experiencing rapid growth, with a market size of 217.9 billion yuan in 2021, projected to exceed 1 trillion yuan by 2030 [3] - Competitors like Meituan and Alibaba have also entered the medical beauty sector, with Alibaba launching its medical beauty channel in 2017 and Meituan's GMV in the medical beauty category expected to surpass 38 billion yuan in 2024 [3]

Core Insights - The Hong Kong pharmaceutical sector is experiencing a strong rally, with the China Securities Hong Kong Stock Connect Pharmaceutical and Health Comprehensive Index (930965) rising by 1.50% as of July 16, 2025, driven by significant gains in individual stocks such as Lijun Pharmaceutical (01513) up 11.16% and Green Leaf Pharmaceutical (02186) up 8.55% [1][2] - The introduction of a commercial health insurance innovative drug directory by the National Healthcare Security Administration on July 11, 2025, marks a significant development, allowing for the inclusion of high-innovation drugs that exceed basic insurance coverage [1][2] - The first innovative drug directory involving commercial insurance is expected to be launched within 2025, potentially creating a more favorable pricing environment compared to traditional medical insurance negotiations [2] Industry Summary - The Hong Kong Medical ETF (513700) has seen a 1.72% increase, marking its fourth consecutive rise, with the latest price reported at 0.65 yuan [1] - The index reflects the performance of 50 liquid and large-cap healthcare companies within the Hong Kong Stock Connect, with the top ten weighted stocks accounting for 59.44% of the index [2] - The commercial health insurance sector is anticipated to experience significant growth, with potential for premium and innovative drug payment scales to increase by several multiples in the long term [2]

Core Viewpoint - JD Health's launch of the "Zhiye Tang" orthopedic store in Tianjin represents a strategic move to address industry chaos and provide standardized, high-quality traditional Chinese orthopedic services to a broader audience [1][8] Group 1: Industry Context - The traditional orthopedic industry faces issues such as low service standardization, varying skill levels among practitioners, and questionable qualifications of some institutions, leading to consumer trust crises [2][5] - Many non-professional institutions use aggressive techniques that can increase pain and pose safety risks, while some establishments misrepresent their services as healthcare without proper licenses [5][10] Group 2: Company Strategy - JD Health aims to reshape the orthopedic market by offering professional, safe, and qualified services, with the Tianjin store being a significant step in its "Internet + Healthcare" strategy [1][8] - The store employs the unique "Natural Linkage Orthopedic Method," which emphasizes patient participation and safety, differentiating it from traditional methods that may carry higher risks [3][4] Group 3: Service Offerings - The "Zhiye Tang" store provides a range of services tailored to different demographics, including youth posture correction, postpartum pain relief for mothers, and muscle stretching for athletes [6][7] - The store also offers free spinal assessments for children under 12 to address potential issues early, reflecting a commitment to community health [7] Group 4: Future Outlook - JD Health plans to expand the "Zhiye Tang" brand to other cities, including Beijing, Shanxi, and Shanghai, as part of its broader strategy to enhance its presence in the healthcare sector [8][10] - The company aims to build a collaborative ecosystem that connects qualified professionals with patients, addressing the shortage of specialized talent in the industry [10]

15 July 2025 | 11:09AM HKT JD Health International (6618.HK) 2Q25 Preview: solid topline alongside still disciplined spending; On-demand investments a key focus; Buy | | | JDH share price has rallied 60% YTD (vs. HSI +21%), outperforming peers (ALH +37%) and the broader Internet sector. At the current valuation level (21X CY26 PE), heading into 2Q result season we anticipate the key debates to be around: 1) On-demand initiatives: JDH's investments/spending and competition dynamics amid broadly intense on-de ...

Group 1 - Hong Kong tech stocks showed strong performance in the afternoon session, with Bilibili (09626.HK) rising over 7% [1] - Alibaba (09988.HK) increased by more than 6.8% [1] - Tencent Music (01698.HK) saw a rise of over 5% [1] Group 2 - Meituan (03690.HK) and Kuaishou (01024.HK) both experienced nearly 4% gains [1] - Tencent Holdings (00700.HK), JD Health (06618.HK), and Baidu (09888.HK) all rose by more than 3% [1]

Investment Rating - The report indicates a positive investment outlook for the AI healthcare industry, highlighting significant growth potential and increasing investment activity in the sector [3][10][46]. Core Insights - The AI healthcare sector is entering a new phase characterized by multi-modal integration and practical applications, driven by advancements in large models and generative AI [3][7]. - Clinical decision support and drug development are leading the commercialization efforts, while health management remains an area with untapped potential [3][14]. - The report emphasizes the importance of third-party vendors in reducing model hallucination rates and enhancing the reliability of AI applications in healthcare [3][18][21]. Summary by Sections AI Healthcare Trends - The industry is experiencing heightened investment interest and technological advancements, with major players accelerating their presence in the AI healthcare space [9][10][13]. - The integration of AI into clinical workflows is becoming standard, with AI-assisted diagnosis systems deployed in 89% of tertiary hospitals [8][14]. AI Healthcare Application Penetration - AI applications are diversifying across clinical diagnosis, drug development, health management, and AI for science (AI4S), with varying levels of maturity and market potential [30][31]. - The report identifies key areas of application, including intelligent clinical decision support, drug discovery, and personalized health management [36][39]. Key Companies in AI Clinical Diagnosis - Companies like Tempus AI and 嘉和美康 are leading in AI-assisted clinical diagnosis, focusing on electronic medical records and data-driven healthcare solutions [47][51]. - The report highlights the importance of data barriers and scenario positioning in determining the value of AI diagnostic tools [3][46]. Key Companies in AI Health Management - Companies such as 阿里健康 and 京东健康 are leveraging AI to enhance online healthcare services, with a focus on chronic disease management and personalized health plans [39][44]. - The report notes that the integration of insurance and healthcare services is crucial for the growth of AI health management solutions [39][44]. Key Companies in AI Drug Development - The report discusses the role of AI in accelerating drug development processes, with companies like Recursion and 晶泰控股 focusing on preclinical research and drug discovery [38][44]. - AI is expected to significantly reduce the time and cost associated with traditional drug development methods [38][44]. AI4S and Broader Applications - AI4S is identified as a growing field with applications in various scientific domains, including life sciences and materials science, although it faces longer conversion cycles [42][44]. - The report emphasizes the need for innovative approaches to data generation and modeling in AI4S applications [42][44].