Rimag Group （2522.HK）A leading medical imaging service provider in China

Investment Rating - Initiate at BUY with a target price of HK$21.41, representing an upside of 21.1% from the current price of HK$17.68 [3][14]. Core Insights - Rimag Group is the largest medical imaging service provider in China, leading the third-party medical imaging services market with significant growth potential [1][9]. - The medical imaging service market in China is expected to grow at a CAGR of 13.6%, reaching RMB661.5 billion by 2030, driven by unmet demand for quality services [1][9]. - Rimag's revenue increased at a CAGR of 25.3% from RMB592.0 million in 2021 to RMB928.9 million in 2023, with expectations of continued growth at a CAGR of 23.3% from 2023 to 2026E [1][30]. Summary by Sections Investment Thesis - The third-party medical imaging center market in China has large growth potential due to low imaging equipment per capita, resource imbalance, and high patient demand for quality services [8][9]. - Rimag is positioned to lead this market with a comprehensive suite of services and a strong operational model [9][10]. Company Overview - Rimag was established in 2014 and has become the largest medical imaging group in China, with 97 imaging centers across 17 provinces and over 220 advanced imaging equipment [10][18]. - The company holds 31 licenses for third-party medical imaging centers, accounting for 19% of the total licenses in China [18]. Financial Performance - Rimag's revenue from imaging center services was RMB638.1 million in 2023, accounting for 68.7% of total revenue, with a gross profit margin of 45.1% [40]. - The company achieved an attributable net profit of RMB44.4 million in 2023, with a net profit margin of 4.8% [30][12]. Business Model - Rimag operates a comprehensive medical imaging platform that provides end-to-end services, including imaging center services, imaging solution services, and Rimag Cloud services [24][27]. - The company integrates operational management, equipment configuration, and talent cultivation to enhance service delivery and efficiency [35][36]. Market Outlook - The third-party medical imaging center market in China is projected to reach RMB18.6 billion by 2030, growing at a CAGR of 30.7% from 2023 to 2030 [1][9]. - Favorable government policies and increasing private sector participation are expected to drive market penetration and growth [9][22].