China Post Securities·2025-03-10 12:55Industry Investment Rating - The industry investment rating is maintained at "Outperform the Market" [1] Core Viewpoints - The report highlights a significant opportunity for domestic gene sequencing manufacturers due to the recent inclusion of Illumina in China's unreliable entity list, which prohibits its export of sequencing instruments to China. This event is expected to reshape the domestic sequencing industry landscape, benefiting local manufacturers [3][4] - The market for gene sequencing instruments and consumables in China is projected to grow from approximately 1.7 billion yuan in 2015 to about 6.8 billion yuan in 2024, with a compound annual growth rate (CAGR) of approximately 16.7%. It is expected to reach around 20.6 billion yuan by 2030, with a CAGR of about 20.3% from 2024 to 2030 [3][4] - The report notes that the domestic market is currently characterized by a duopoly between Illumina and BGI, with Illumina holding a market share of 49.1% and BGI holding 25.7% as of 2023 [3][4] Summary by Sections 1. Weekly Insights: New Landscape for Domestic Gene Sequencing Manufacturers - The report emphasizes the favorable conditions for leading domestic sequencing manufacturers like BGI and Sansure Biotech, which are expected to capture market share as a result of the Illumina export ban [3][4] - BGI is positioned to expand its market share due to its leading advantages in sequencing technology and its rapid response in launching alternative sequencing platforms [4][14] - Sansure Biotech has received regulatory approval for its SansureSeq1000 sequencing instrument and is expected to leverage its marketing capabilities to gain market share [15][16] 2. Weekly Insights: Pharmaceutical Sector Performance - The pharmaceutical sector saw a weekly increase of 1.06%, underperforming the CSI 300 index by 0.32 percentage points, ranking 19th among 31 sub-industries [17][20] - The in-vitro diagnostics sector experienced the highest growth, increasing by 4.45%, while the offline pharmacy sector saw the largest decline, dropping by 0.59% [21][22] 3. Recommended and Beneficiary Stocks - Recommended stocks include BGI, Sansure Biotech, and other companies such as Xintai, Meinian Health, and Tianshili [5][26] - Beneficiary stocks include Yuyuan Medical, Weigao Medical, and Huada Gene, among others [5][26] 4. Sector Performance and Investment Opportunities - The report identifies three key investment themes: innovative drugs, low-value consumables, and AI in medicine, highlighting the potential for significant growth in these areas [22][24] - The report suggests that the medical device sector has considerable upside potential due to ongoing policy changes and market dynamics favoring domestic manufacturers [25][26] 5. Market Trends and Future Outlook - The report anticipates a recovery in the medical services sector as seasonal demand increases, particularly in comprehensive hospitals and health check-up services [35] - The report also notes that the traditional Chinese medicine sector is expected to recover as the impact of high base effects and price reductions from centralized procurement diminishes [36]