Core Viewpoint - Guosheng Tang (02273) is maintaining a "Buy" rating, with projected revenue and net profit growth from 2025 to 2027, indicating strong financial performance and a focus on AI in traditional Chinese medicine [1][2] Financial Projections - Expected revenue for Guosheng Tang is projected to be 3.4 billion, 4.2 billion, and 5.0 billion for 2025, 2026, and 2027 respectively [1] - Corresponding net profit estimates are 430 million, 544 million, and 680 million for the same years, with adjusted net profits of 470 million, 569 million, and 690 million, reflecting year-on-year growth rates of 17%, 21%, and 21% [1] Recent Performance - In the first half of 2025, Guosheng Tang achieved revenue of 1.495 billion, a 9.5% increase year-on-year, with a net profit of 152 million, up 41.9% [1] - The adjusted net profit for the same period was 170 million, representing a 15.2% increase [1] - Patient visits increased by 15.3% year-on-year, totaling 2.75 million visits in the first half of 2025, with an average spending of 544 per visit [1] Profitability Metrics - The gross margin for the first half of 2025 was 30.63%, an increase of 1.23 percentage points year-on-year [1] - The adjusted net profit margin was 11.40%, up 0.56 percentage points year-on-year [1] AI Development - Guosheng Tang has launched 10 AI models covering eight specialties in traditional Chinese medicine, enhancing service quality [2] - The company has also introduced an AI health assistant to improve patient experience [2] Shareholder Returns - Guosheng Tang has a consistent policy of high cash dividends and stock buybacks, announcing an interim dividend of 0.35 HKD per share for 2025, totaling 82.3 million HKD [2] - As of October 3, 2025, the company repurchased 5.19 million shares, accounting for approximately 2.18% of total shares, with a buyback amount of 166 million HKD [2] - In 2024, the company repurchased 7.62 million shares for 279 million HKD and paid out 1.29 billion HKD in dividends, totaling 407 million HKD in cash returns to shareholders [2]