Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **China Healthcare** industry, specifically the **medical device sector** and the implementation of **Value-Based Procurement (VBP)** [1][2][3]. Core Insights and Arguments - **VBP Implementation Pace**: The overall pace of VBP implementation has been slow in 2025, with significant announcements made in January but actual provincial actions only starting in October [2][3]. - **Shift in Public Sentiment**: There is a noticeable shift in public sentiment towards VBP, emphasizing the efficacy and quality of medical devices over mere price reductions [2][3]. - **Impact on Domestic Brands**: Domestic brands have gained hospital access and market share due to VBP, allowing them to compete effectively with multinational corporations (MNCs) [3][4]. - **Prolonged Impact on Fundamentals**: The effects of VBP on pricing and revenue may last longer than initially expected, potentially extending beyond two years due to various factors such as inventory adjustments and regional rollout differences [4][13]. - **Government Support for Innovation**: The government intends to support innovation in medical devices, but substantial support will likely depend on the implementation of Diagnosis-Related Groups (DRG) and Diagnosis-Related Payment (DIP) systems [2][4]. Upcoming VBP Announcements - Several upcoming VBP announcements are expected, covering various product categories and regions, including heart occluders, high-frequency electrosurgical units, and TCM acupuncture needles [10][11]. Company-Specific Insights - **AK Medical**: The company is confident in achieving a net profit of **Rmb 330-340 million** for FY25, despite VBP pressures. VBP-ed products account for over **66%** of domestic sales, leading to some margin compression [13][14]. - **Weigao**: Reported a preliminary 3Q revenue of **Rmb 3.26 billion**, with modest growth of **+2.6%** year-over-year. The orthopedic segment showed stronger growth post-VBP renewal [15]. - **Angelalign**: Management expressed concerns about the upcoming VBP for clear aligners, with potential delays in patient treatments impacting volumes [16]. - **Mindray**: Anticipates lower revenue from ultrasonic scalpels and staplers due to slower-than-expected VBP implementation. The IVD industry is projected to contract in 2025 [19][20]. - **SNIBE**: Reports a **10-15%** year-over-year decline in testing volume, but expects a smaller decline of **2-3%** next year, with stable pricing anticipated for the upcoming VBP renewal [21]. Additional Important Insights - **Market Share Changes**: The market share of MNCs has decreased across various product categories post-VBP, indicating a shift towards domestic players [30][31]. - **Pricing Trends**: The pricing cuts from ceiling prices in VBP have become more rational since 2022, with a notable reduction in the average cut from ceiling prices compared to earlier years [24][25]. This summary encapsulates the key points discussed in the conference call, highlighting the current state and future outlook of the China healthcare medical device sector amidst ongoing VBP implementations.

Summary of Conference Call Notes Industry Overview - **Industry**: Healthcare Equipment in China - **Key Insights**: The bidding value for hospital equipment in October 2025 showed a higher-than-expected year-on-year (YoY) growth of 16%, attributed to ongoing trade-in programs. However, there was a month-on-month (MoM) decline of 1% compared to September due to the National Day holiday. The outlook for November remains cautious due to a high comparison base from the previous year and lower trade-in program values in 2025 compared to 2024. [1][1][1] Company-Specific Insights United Imaging - **Performance**: United Imaging reported a strong performance in Q3 2025, with domestic revenue growing 73% YoY and overseas revenue increasing by 81% YoY. Service revenue also grew steadily at 22% YoY. [11][11][11] - **Future Expectations**: The company anticipates challenges in fully utilizing the trade-in budget for 2025, similar to 2024, but expects the total scale of the 2026 trade-in program to match or exceed 2025 levels. [13][13][13] - **Valuation**: Currently trading near its median P/E multiple since listing, with significant long-term growth potential expected due to revenue, gross profit margin (GPM), and net profit margin (NPM) growth. [13][13][13] Mindray - **Performance**: Mindray's core businesses showed mixed results in Q3 2025, with PMLS growing by 2.6%, MI by 1%, and IVD declining by 2.8%. Domestic PMLS revenue decline narrowed to -25% from -57% in the first half of 2025, while overseas sales grew by 14%. [14][14][14] - **Future Outlook**: The company expects a recovery in revenue in 2026, driven by emerging markets and high-potential products. The IVD industry is expected to continue contracting but at a smaller magnitude than in 2025. [14][14][14] - **Investment Thesis**: Mindray is positioned for long-term double-digit growth supported by recurring business in China and market share gains in emerging markets. The company is rated as a Buy with a target price of Rmb285. [69][69][69] Key Risks - **Mindray**: Risks include further impacts from Value-Based Procurement (VBP), lower-than-expected penetration into top-tier hospitals, challenges in entering North American and European markets, patent-related lawsuits, and unexpected changes in trade policies. [75][75][75] - **United Imaging**: Risks include chip supply chain issues, raw material risks, macroeconomic downturns in China, and potential VBP risks. [76][76][76] Additional Insights - **Bidding Trends**: The bidding value for various medical devices showed fluctuations, with notable increases in ultrasound (+54% YoY) and CT scanners (+44% YoY) in October 2025, while MRI and PET-CT showed declines of -2% and -64% YoY, respectively. [27][36][38] - **Market Dynamics**: The healthcare equipment market in China is experiencing a rebound due to increased government funding and a growing market share for domestic manufacturers. [70][70][70] This summary encapsulates the key points from the conference call, highlighting the performance and outlook of the healthcare equipment industry in China, particularly focusing on United Imaging and Mindray.

Summary of Key Points from the Global Healthcare Conference Call Industry Overview - **Healthcare Sector Performance**: The healthcare sector has underperformed, with a year-to-date increase of only 3% compared to the S&P 500's 13% increase. Sub-sector performance varies significantly, with Biotech up 16%, Pharma up 4%, and Managed Care down 25% [1][11][12]. - **S&P 500 Weighting**: The healthcare sector's weighting in the S&P 500 has dropped to approximately 9.1%, the lowest since 1994, compared to 16% two and a half years ago [1][11]. Core Insights and Arguments - **Optimism for 2026**: Despite recent challenges, there are signs of optimism for 2026, with expectations of improved demand and sentiment in the healthcare sector [1][9][46]. - **Biopharma M&A Activity**: M&A volumes in the biopharma sector are expected to exceed those of the second half of 2024, driven by the need to fill clinical pipelines [2][21]. - **Impact of Tariffs**: Tariffs have been a persistent issue affecting U.S. MedTech, with valuations fluctuating. The S&P Equipment & Supplies Index P/E is around 1.0x, down from a 10-year average of 1.26x [3][30]. - **Life Sciences Uncertainty**: There remains uncertainty in the life sciences sector, with management teams focusing on NIH budget changes and global tariffs as key factors influencing demand [4][46]. Additional Important Insights - **China as an Innovation Hub**: China is emerging as a global hub for biotech innovation, with low geopolitical risk, particularly for CROs with domestic exposure [6][29]. - **Healthcare Technology and Distribution**: This segment is relatively insulated from political risks but still faces challenges from drug pricing policies and potential Medicaid cuts [5][49]. - **AI Integration in MedTech**: The integration of AI in MedTech is increasing, with over 1,200 AI-enabled devices documented, indicating a significant technological shift in the industry [32][33]. - **Tariff and FX Impact on European MedTech**: In Western Europe, FY25 and FY26 EPS forecasts have decreased by 9% and 10% respectively, largely due to tariffs and foreign exchange impacts [36][38]. Key Themes and Stock Picks - **Top Picks by Sector**: - **U.S. Pharmaceuticals and Biotech**: LLY, VRTX, GILD [10]. - **U.S. SMID Cap Biotech**: ARGX [10]. - **U.S. MedTech**: BSX, EW, IRTC [10]. - **Western Europe MedTech & Life Sciences**: ALC, FRE-DE, SNN [10]. - **U.S. Life Sciences Tools & Diagnostics**: A, WST, GH [10]. - **China Healthcare**: Hengrui, Hansoh, Ascletis, Abbisko, Mindray, MicroPort Medbot, Wuxi Apptec, Wuxi Bio [10]. Conclusion - The healthcare sector is navigating through a challenging landscape marked by tariff impacts, policy uncertainties, and varying sub-sector performances. However, there are emerging opportunities, particularly in biopharma M&A and AI integration, which could drive growth as the sector moves into 2026.

Summary of the Webinar on the Chinese Medtech Market Industry Overview - The focus of the webinar was on the **Chinese Medtech market**, highlighting its evolution and current dynamics [3][8] - The Chinese healthcare system is transitioning towards **efficiency, cost containment**, and **domestic self-reliance** [3] Key Points and Arguments - **Historical Growth**: The Medtech market in China experienced rapid growth due to healthcare modernization, an aging population, and supportive government policies, including universal insurance coverage and significant public health investments [3][10] - **Recent Challenges**: The market is facing headwinds due to government policies favoring local companies, such as "Buy Local" directives and Volume Based Procurement (VBP), which have reduced prices and disrupted demand for capital equipment [3][4] - **Market Share Dynamics**: Multinational companies (MNCs) are losing market share in hospital-facing Medtech sectors (e.g., imaging, diagnostics) to local competitors, while they remain focused on premium segments where innovation gaps exist [4][41] - **Consumer Medtech Growth**: In contrast, the Consumer Medtech sector, particularly in self-pay markets like dental and ophthalmology, is expected to see high-single to double-digit growth due to low penetration rates and brand loyalty [4][30] Financial Implications - **Sales Exposure**: For many Medtech companies, China now represents a smaller share of total sales. For example, Smith & Nephew's sales from China are projected to drop from 7% in 2019 to approximately 3% in 2025 [5][7] - **Company Exposure Categorization**: - **Risk**: Companies like Philips, Healthineers, and Coloplast face significant risks due to their exposure to the Chinese market - **Neutral**: Companies such as Medtronic and Abbott have a neutral stance - **Opportunity**: Companies like Alcon and Carl Zeiss are seen as having growth opportunities in China [5][7] Market Dynamics - **Healthcare Spending Trends**: China's healthcare spending grew at a **17% CAGR from 2000 to 2015**, followed by an **8% CAGR through 2022** [10] - **Policy Shifts**: Major policy changes since 2015 have aimed to strengthen domestic industry, impacting MNCs' operations [13][14] - **Local Competition**: Local players are rapidly gaining market share, particularly in highly penetrated markets like medical imaging [44][45] Consumer Medtech Insights - **Adoption Rates**: Consumer Medtech markets have lower starting points for adoption, allowing for significant growth potential. For instance, dental implant adoption in China is still below that of developed markets [24][30] - **Self-Pay Market Dynamics**: The self-pay nature of these markets allows for greater price elasticity and brand influence, benefiting international players [25][27] - **Brand Importance**: Brand recognition plays a crucial role in maintaining market share against local competitors, especially in private healthcare settings [27][51] Future Outlook - **Growth Prospects**: The outlook for Consumer Medtech in China remains optimistic over the next 5-10 years, while caution is advised for capital equipment and orthopedics due to increased local competition [41][41] - **Regulatory Impact**: Changes in public health systems can influence private pay markets, as seen with recent VBP programs [39] Conclusion - The Chinese Medtech market is undergoing significant transformation, with both challenges and opportunities for multinational companies. The focus on local competition and policy shifts necessitates a strategic approach for MNCs to navigate this evolving landscape [3][4][41]

Summary of the Conference Call Transcript Industry Overview - **Industry**: China Healthcare - **Key Companies Mentioned**: Akeso, Innovent, Hansoh, BeOne, Simcere, Duality Bio, Leads Bio, GenFleet, CSPC, Sino Biopharm, Mindray Core Insights and Arguments 1. **Investor Focus Areas**: Investors are concentrating on potential licensing-out opportunities, risks associated with potential Executive Orders from the US Administration, and current valuations of biopharma companies [2][3] 2. **Investor Sentiment**: There is a notable interest in Akeso for potential buying opportunities, while BeOne and Simcere are perceived as undervalued [2] 3. **Emerging Companies**: Newer companies like Duality Bio, Leads Bio, and GenFleet are attracting strong interest from investors [2] 4. **Generalist Investors' Participation**: Generalist investors have increased their participation in the healthcare sector year-to-date, with many being equal or overweight relative to the MSCI sector percentage [3] 5. **Caution Among Specialists**: Specialists are becoming more cautious regarding companies driven by business development expectations, particularly CSPC and Sino Biopharm, due to uncertainties around US approvals [4] 6. **Valuation Concerns**: Generalist investors are turning conservative on companies with high business development valuation contributions due to potential restrictions from US Executive Orders [3] 7. **Performance of Core Holdings**: Hengrui and Hansoh are noted for their strong performance as core holdings due to their consistent track record and R&D capabilities [3] Risks and Challenges 1. **Healthcare Industry Risks**: Key risks identified for China's healthcare industry include: - Worse-than-expected price cuts from GPO programs - Intensified competition - Lower-than-expected innovative drug prices negotiated for NRDLs - Slower-than-expected consumption recovery in China - Stricter-than-expected regulatory announcements and implementations - Rising geopolitical tensions affecting operations [6] Additional Insights 1. **Market Dynamics**: Investors are showing interest in relatively inexpensive valuations of CXO and medtech names, looking for potential growth acceleration or recovery [2] 2. **Profit-Taking**: Generalist investors are considering profit-taking on certain names due to difficulties in identifying alpha opportunities in crowded therapeutic areas [3] 3. **IPO Interest**: There is interest in new IPO listings, particularly GenFleet, as investors seek opportunities outside of established names [4] Conclusion The conference call highlighted a cautious yet opportunistic sentiment among investors in the China healthcare sector, with a focus on emerging companies and potential risks stemming from regulatory changes and market dynamics. The overall investor landscape is shifting, with generalist investors becoming more selective and specialists expressing caution regarding business development-driven companies.

Summary of China Healthcare Conference Call Industry Overview - The conference call focused on the **China hospital equipment industry**, highlighting the bidding data for medical devices in August 2025, which showed better-than-expected growth. Key Points 1. **Bidding Growth**: - August 2025 saw a month-over-month (MoM) growth of **+12%** and a year-over-year (YoY) growth of **+32%**, marking the tenth consecutive month of positive growth [2][8][32]. - This growth is attributed to the implementation of this year's trade-in funding, which has begun to stimulate bidding values [2][22]. 2. **Trade-in Program**: - The trade-in program's impact was confirmed as the rolled-over funding from the previous year was largely utilized by July, indicating that new funding has started to take effect [2][22]. 3. **Device Performance**: - Among nine tracked medical devices, seven showed positive YoY growth in August, with notable increases in PET-CT (+173%), CT scanners (+81%), and DR (+54%) [32][51][53]. - The ultrasound segment also saw a significant increase of **+35%** YoY in August, up from **+23%** in July [18][23]. 4. **Market Dynamics**: - Domestic companies have shown resilience, with all domestic players recording positive growth, while multinational corporations (MNCs) had previously shown negative growth, which has now largely disappeared [12][20]. - Ongoing regional Value-Based Procurement (VBP) remains a concern, particularly affecting pricing in the ultrasound and CT scanner segments [16][22]. 5. **Company-Specific Insights**: - **United Imaging**: - Reported a **+22%** YoY revenue growth in Q2 2025, with expectations of **+45%** and **+15%** growth for Q3 and Q4 2025, respectively [22][84]. - The company is optimistic about the trade-in program's scale and pace in 2025, expecting smoother operations compared to 2024 [22][84]. - **Mindray**: - Experienced a decline in patient monitor sales (-25% YoY in August) but saw strong growth in ultrasound (+35% YoY) [23][83]. - The company is managing inventory risks and expects to return to positive growth levels in Q3 2025 [23][24]. 6. **Investment Outlook**: - Both United Imaging and Mindray are rated as "Buy" by analysts, with significant long-term growth potential anticipated due to increasing government support and market share growth [84][83]. - Key catalysts for growth include procurement recovery, updates on the trade-in program, and new product launches [83][84]. Additional Insights - The conference highlighted the importance of monitoring ongoing VBP developments and their impact on pricing strategies within the medical device sector [16][22]. - Analysts emphasized the need for investors to consider potential risks, including supply chain issues and regulatory changes that could affect market dynamics [86][87]. This summary encapsulates the critical insights from the conference call, providing a comprehensive overview of the current state and future outlook of the China hospital equipment industry.

Summary of Key Points from the Conference Call Industry Overview - The conference call focuses on the **Global Healthcare** industry, particularly the integration of **AI/ML technologies** within various healthcare sectors, including medical devices, healthcare services, therapeutics, and diagnostics [2][11][22]. Core Insights and Arguments 1. **AI Use Cases in Healthcare**: - AI is being utilized for better drug/product design, increased labor efficiency, and process automation within healthcare systems [2][3]. - The potential for AI to transform drug/device development is significant, with expectations of cost-efficient drug discovery and improved clinical trial execution [3][5]. 2. **Labor Shortages and Operational Efficiency**: - A projected global healthcare worker shortage of over **10 million** by **2030** highlights the need for technologies that enhance operational efficiencies [4]. - AI technologies could help mitigate physician burnout, which affects approximately **1.76 million** workers [4]. 3. **Impact on Diagnosis and Treatment Rates**: - AI innovations in diagnostics could lead to earlier and more accurate diagnoses, potentially increasing treatment rates, especially in populations with historically low screening rates [5]. 4. **Investment Trends**: - AI/ML investments are growing within healthcare, with **25%** of global VC capital in healthcare allocated to AI/ML in **1H25**, up from a **15%** average in previous periods [12][16]. - In the US, AI/ML deals in healthcare saw a **16% YoY** increase, despite an overall decline in healthcare VC investments [18]. 5. **Sector-Specific Insights**: - **Medical Devices**: AI is expected to enhance trial and product design, manufacturing, and labor productivity [22]. - **Healthcare Services**: Improved data analytics and process automation are anticipated to enhance operational efficiencies [25]. - **Therapeutics**: Drug development and trial optimization are seen as key areas for AI adoption [26]. 6. **Company-Specific Developments**: - Companies like **Edwards Lifesciences** and **Medtronic** are actively piloting AI initiatives to improve patient identification and treatment processes [28]. - **Quest Diagnostics** reported a **3%** annual productivity increase attributed to AI, while **LabCorp** noted over **$100 million** in savings from AI-driven cost-cutting measures [34]. Additional Important Content - The call highlighted the increasing frequency of AI mentions in healthcare earnings calls, with **10%** of calls in **1Q25** discussing AI, particularly among providers and medical devices [11]. - The report emphasizes that while AI presents numerous opportunities, evidence of its impact on revenue and margins remains limited and early-stage across various subsectors [22][29]. - The analysts noted that companies slow to adopt AI may face challenges in maintaining competitiveness in the evolving healthcare landscape [30][34]. This summary encapsulates the key points discussed in the conference call, providing insights into the current state and future potential of AI in the healthcare industry.

Summary of Conference Call Notes Industry Overview - **Industry**: China Healthcare, specifically focusing on hospital equipment and medical devices - **Key Trends**: - July 2025 bidding value data showed a -11% month-over-month (MoM) decline, marking the third consecutive month of decrease, but a +23% year-over-year (YoY) increase was noted, indicating actual demand growth in hospitals [1][2] - The trade-in stimulus, deferred from 2024 to 2025, is expected to have a less pronounced effect compared to previous years [2] Company-Specific Insights United Imaging - **Management Outlook**: Optimistic about the new trade-in program in 2025, expecting a smoother process compared to 2024. However, revenue recognition cycles have lengthened due to changes in hospital bidding processes [19] - **Revenue Growth Projections**: Estimated growth rates for China revenue are +10% for 2Q25, +45% for 3Q25, and +26.8% for 4Q25. The DSA (imaging-guided therapy) product is identified as a near-term growth driver [21] - **Market Position**: Currently trading near median P/E multiple since listing, with significant long-term growth potential anticipated [21][88] Mindray - **Market Performance**: Slower YoY growth observed in patient monitors (+21% in July vs. +50% in June) and ultrasound (+24% in July vs. +48% in June) due to ASP pressure from VBP [26] - **Inventory Management**: Expected to normalize inventory turnover by 2Q25 across all segments [26] - **Investment Thesis**: Strong healthcare infrastructure and domestic substitution trends are expected to support growth. Trading below 5-year average forward P/E due to policy risks, but maintaining market leadership is anticipated [87] Key Data Points - **Bidding Value Trends**: - Positive YoY growth for nine consecutive months, with domestic brands outperforming MNCs [10] - Significant price declines in ultrasound and CT segments due to VBP, with ultrasound prices expected to remain under pressure [14] - **Procurement Value Changes**: - Ultrasound procurement value increased by +24% YoY in July, while CT scanners saw a +44% increase [45][47] - LINAC procurement value increased by +46% YoY in July, down from +161% in June [65] Risks and Challenges - **Market Risks**: - Ongoing regional VBPs are a key concern, with potential impacts on pricing and procurement processes [14] - Risks associated with chip supply chains, raw material availability, and macroeconomic downturns in China [92] Conclusion - The healthcare equipment industry in China is experiencing a complex landscape with both growth opportunities and challenges. Domestic companies like United Imaging and Mindray are positioned to benefit from favorable trends, although they must navigate pricing pressures and changing procurement dynamics.

Investment Rating - The report maintains a "Buy" rating on Mindray, highlighting its strong market position and growth potential in the healthcare sector [92]. Core Insights - The procurement value of main medical devices in China showed a year-on-year growth rate of 49% in June 2025, although it fell short of previous expectations due to a 3% month-on-month decline driven by lower unit prices from Value-Based Procurement (VBP) policies [1]. - The report anticipates a decline in the trade-in stimulus effect for the second half of 2025, as applications for trade-in funding have decreased in recent months [1]. - The ultrasound segment has experienced significant price declines due to VBP, with CT scanners also seeing sharp price reductions [9][13]. - The market share of non-GPSU brands in CT scanners has increased during the first half of 2025, indicating a shift in brand dynamics within the industry [24]. Summary by Sections Procurement Trends - The total bidding value for nine main medical devices in China has shown fluctuations, with significant year-on-year growth in various segments, including a 62% increase for CT scanners in June 2025 compared to May 2025 [51]. - The report notes that 30% of ultrasound procurement volume is expected to be impacted by VBP by the end of 2025, with an average price cut of 50%-60% [22]. Company-Specific Insights - Mindray is positioned as a leading medtech device manufacturer in China, with 55% of its revenue coming from the domestic market. The company is expected to benefit from strong healthcare infrastructure development and increasing overseas revenue [92]. - United Imaging has expanded its presence globally and is witnessing a rebound in medical equipment procurement in China, supported by government initiatives [93]. Market Dynamics - The report highlights that both domestic and multinational companies achieved notable year-on-year growth in June, indicating a competitive landscape in the medical device sector [74]. - The ongoing VBP policies are a key concern, affecting pricing and procurement strategies across various medical device categories [9].

Investment Rating - The report maintains a "Buy" rating for several companies in the healthcare sector, including Asymchem, InnoCare, Samsung Biologics, Shandong Weigao Group, United Imaging, and Zai Lab [29][30]. Core Insights - The China biotech sector has seen a significant re-rating, with a year-to-date increase of 72%, driven by a surge in licensing-out deals, particularly in PD-1/VEGF bispecifics, which has validated asset quality and innovation [1][2]. - Investors are optimistic about the sustainability of this momentum, with expectations for more licensing deals to follow, including potential major deals from CSPC and Sino Biopharma [2]. - The CRO/CDMO sector has also benefited from increased licensing activity, with a 25% year-to-date growth, and companies like Tigermed and WuXi AppTec are highlighted for their resilience [8]. - Medtech is showing signs of recovery, with equipment tendering up 91% year-over-year in May, although revenue recognition remains a challenge due to inventory digestion and centralized procurement processes [8][10]. Summary by Sections China Biotech Licensing and Global Pharma Engagement - The rebound in China biotech is largely attributed to licensing deals with global pharma, enhancing confidence in the quality and innovation of Chinese biotech assets [2]. - Notable licensing deals include Akeso to Summit and 3S Bio to Pfizer, which have allowed companies to monetize global market valuations through royalties [2]. CDMO/CRO Implications - The CRO/CDMO sector has seen a 25% increase year-to-date, with Tigermed reporting a 20% year-over-year increase in new orders for Q1 [8]. - WuXi AppTec and Asymchem are expected to deliver resilient earnings due to their focus on late-stage and commercial manufacturing [8]. Medtech Recovery and Tendering Trends - Medtech has faced challenges, with a year-to-date decline of 4%, but there are signs of recovery in equipment tendering, which increased by 91% year-over-year in May [8][10]. - Companies like United Imaging and Mindray are expected to turn positive in their growth trajectories in the coming quarters [8]. Global Pharma Engagement - Global large pharma continues to recognize the importance of China in their business development strategies, particularly in the context of biopharma innovation cycles [10]. - Companies like GE Healthcare and Philips remain cautious about the capital equipment procurement environment in China, despite positive tendering momentum [10].