IRAY TECHNOLOGY(SH:688301) HTSC·2025-10-29 04:01Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 153.17, up from the previous RMB 143.6, corresponding to a PE of 49 times for 2025 [6][5]. Core Insights - The company reported Q3 revenue of RMB 482 million, a year-over-year increase of 46.18%, but a quarter-over-quarter decrease of 17.55%. The net profit attributable to the parent company was RMB 136 million, up 64.43% year-over-year but down 28.97% quarter-over-quarter. For the first three quarters of 2025, total revenue reached RMB 1.549 billion, a year-over-year increase of 14.22%, with a net profit of RMB 471 million, up 20.61% year-over-year [1][2]. - The company expects rapid growth in its core components and solutions, with significant contributions from new business lines such as CT tubes, X-ray sources, and silicon-based OLED microdisplay backplanes [1][2]. - The gross margin for Q3 was 49.8%, down 4.9 percentage points year-over-year, while the net margin improved by 3.6 percentage points to 27.3%, attributed to a decrease in expense ratios across various categories [3]. Revenue and Profitability - The company experienced a recovery in revenue and profit in Q3, with a notable acceleration in growth compared to Q2. The core components and solutions business saw revenue growth of 17% and 110% respectively in the first half of 2025 [2]. - The company has successfully delivered C-arm solutions to major domestic clients and has entered the South Korean market, indicating strong demand for its products [2]. Financial Forecast and Valuation - The company has slightly raised its profit forecast for 2025, projecting net profits of RMB 610 million, RMB 854 million, and RMB 1.104 billion for 2025, 2026, and 2027 respectively, with corresponding PE ratios of 41, 29, and 23 times [5][10]. - The report highlights that the company's estimated PE for 2025 is 53 times, suggesting a premium valuation compared to peers [5][20].