Investment Rating - The investment rating has been downgraded to "Outperform" [1][4] Core Insights - The company reported a revenue of RMB 1.58 billion for the first nine months of 2025, a 4.05% increase from RMB 1.52 billion in the same period of 2024. Q3 2025 revenue was RMB 541 million, up 3.47% year-on-year. However, net profit for the same period was RMB 116 million, down 17.34% year-on-year, with a net profit margin of 7.31%. Q3 2025 net profit was RMB 34 million, down 40.90% year-on-year. The forecasted EPS for 2025-2027 is RMB 0.44, 0.50, and 0.60 respectively, with a target price of RMB 15.36 based on a PE of 35X for 2025. The downgrade is attributed to the anticipated slow growth in gene sequencing services [4][11][12]. Financial Summary - Total revenue projections are as follows: - 2023A: RMB 2,002 million - 2024A: RMB 2,111 million - 2025E: RMB 2,197 million - 2026E: RMB 2,441 million - 2027E: RMB 2,716 million - Net profit (attributable to the parent) is projected as: - 2023A: RMB 178 million - 2024A: RMB 197 million - 2025E: RMB 183 million - 2026E: RMB 210 million - 2027E: RMB 249 million - The net profit margin is expected to fluctuate, with a decrease in 2025E [3][6][11]. R&D and Strategic Investments - The company has maintained high R&D investment, with R&D expenses reaching RMB 119 million from January to September 2025, a 50.48% increase year-on-year, accounting for 7.51% of revenue. Q3 2025 R&D expenses were RMB 56.10 million, focusing on emerging fields such as single-cell, spatial omics, and proteomics [12][13]. - The company is also investing in global expansion and customer engagement, which has led to increased R&D expenses and fluctuations in gross profit margin [12][14]. Sales and Marketing Expenses - Sales expenses have slightly increased due to global localization and marketing upgrades, with a sales expense ratio of 20.38% from January to September 2025, up 0.76 percentage points year-on-year. The Q3 2025 sales expense ratio was 21.06%, up 1.43 percentage points year-on-year [14].