Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a revenue of 1.067 billion yuan for H1 2025, a year-on-year increase of 3.94%, and a net profit attributable to shareholders of 335 million yuan, up 8.82% year-on-year [4][5] - In Q2 2025, the company achieved a revenue of 585 million yuan, representing a year-on-year growth of 9.32%, and a net profit of 191 million yuan, which is a 13.86% increase year-on-year [5] - The company is focusing on R&D and expanding into new business areas, with R&D investment reaching 154 million yuan in H1 2025, accounting for 14.46% of revenue [6][9] Summary by Sections Financial Performance - In H1 2025, the company's detector sales generated 866 million yuan, with a year-on-year growth of 2.65% and a gross margin of 60.57% [5] - The overall gross margin for Q2 2025 was 56.31%, with a sales expense ratio of 3.95% and a management expense ratio of 6.05% [5] R&D and Innovation - The company has increased its R&D efforts, registering 70 new IPs, including 32 invention patents [6] - The company is advancing the development of various new detectors and has successfully launched several micro-focus X-ray sources, breaking the import monopoly in this field [6][8] Market Expansion - The company is actively expanding its market presence by providing a range of core components and integrated solutions, with core component sales reaching 82 million yuan, up 16.90% year-on-year [7] - The company is also entering the silicon-based OLED backplane market, with an investment of up to 1.8 billion yuan to increase production capacity [8] Future Projections - Revenue projections for 2025-2027 are 2.266 billion yuan, 3.100 billion yuan, and 4.133 billion yuan, with year-on-year growth rates of 23.7%, 36.8%, and 33.3% respectively [9] - Expected net profits for the same period are 647 million yuan, 832 million yuan, and 1.101 billion yuan, with corresponding year-on-year growth rates of 39.1%, 28.6%, and 32.3% [9]

Core Viewpoint - The company Yirui Technology, known as the "first stock of digital X-ray detectors" on the Sci-Tech Innovation Board, is facing dual challenges from capital withdrawal and industry changes [1][2]. Group 1: Capital Movements - Early investors Sequoia Capital are planning to reduce their holdings by up to 2%, potentially cashing out approximately 350 million yuan at the current closing price, marking their sixth round of reductions [1][2]. - Sequoia Capital has cumulatively cashed out nearly 1.86 billion yuan over six rounds of reductions since 2021, with their current holding dropping to a historical low of 6.66% if the latest reduction is fully executed [2]. Group 2: Financial Performance - Yirui Technology has experienced a decline in profits for three consecutive years, with projected revenue of 1.831 billion yuan in 2024 (down 1.74% year-on-year) and a non-net profit of 439 million yuan (down 25.84% year-on-year) [3]. - In Q1 2025, the company reported revenue of 482 million yuan (down 1.92% year-on-year) and a non-net profit of 141 million yuan (down 9.19% year-on-year) [3]. - Shareholders are increasingly selling off their stakes, with a recent transaction involving a major shareholder selling shares at a 14% discount to market price, reflecting cautious expectations for short-term stock performance [3]. Group 3: Strategic Moves - In response to operational challenges, Yirui Technology is investing over 3 billion yuan in two major expansion projects, including an 1.8 billion yuan investment in a micro-display backplane project and an 1.174 billion yuan X-ray vacuum device project [4]. - The expansion projects represent 37% of the company's total assets for 2024 and are closely linked to the chairman's other company, Shiya Technology, which is preparing for an IPO despite not yet being profitable [4]. Group 4: Market Outlook - There are signs of potential recovery in the medical equipment procurement market, with a reported 41% year-on-year increase in procurement scale for the first half of 2025, particularly in CT and DR equipment, which are core applications for Yirui's detectors [5]. - However, Yirui Technology faces significant competition in the silicon-based OLED market from global giants like Sony, which dominate a market worth over 500 million USD, posing challenges in technology accumulation and cost control [6].

Core Viewpoint - The strategic cooperation between Yisray Technology and Brazil's VMI Group marks a significant step in enhancing bilateral trade and investment opportunities between China and Brazil, particularly in the medical and industrial sectors [1]. Group 1: Strategic Cooperation - Yisray Technology signed a strategic cooperation agreement with Brazil's VMI Group to deepen collaboration in the Brazilian market and explore opportunities in Latin America [1]. - VMI Group is a leading local manufacturer of X-ray imaging equipment in Brazil with 35 years of industry experience and a mature localized service network [1]. - This partnership aligns with China's Belt and Road Initiative and Brazil's Development Plan, showcasing a strong synergy between the two countries' economic strategies [1]. Group 2: Global Expansion and Production Capacity - As of 2024, Yisray Technology's products are sold in over 80 countries and regions, supported by nine technical service centers globally [2]. - The company has established a comprehensive customer service system and has set up overseas sales or service platforms in various countries, including the USA, Germany, and Brazil [2]. - Yisray Technology is expanding its production capacity with investments in its Hefei and Taicang production bases, aiming to enhance its global manufacturing footprint [2]. Group 3: Brand Development and Market Penetration - Yisray Technology is focused on enhancing its international brand influence while exploring new customer segments in various fields such as dental, industrial, and veterinary [3]. - The company actively participates in major global industry exhibitions to strengthen its market presence and customer engagement [3]. - The collaboration with VMI Group is expected to accelerate the penetration of X-ray technology in medical and industrial sectors, benefiting a wider audience [3].

Investment Rating - The report maintains a "Buy" rating for the company [6][20]. Core Views - The company is a leading global supplier of X-ray core components and solutions, with a diversified downstream distribution. The recovery in downstream medical, dental, and industrial sectors since 2025 is promising, and new products like CT tubes and silicon-based OLED microdisplay backplanes are expected to have significant growth potential [1][2]. - The company has announced an investment of up to RMB 1.8 billion for a silicon-based OLED microdisplay backplane production project, which is anticipated to add a capacity of 5,000 units per month [3][15]. - There is substantial domestic replacement potential for core components like CT tubes, with an estimated market space of RMB 1 to 5 billion due to the ongoing anti-dumping investigations against imports from the US and India [4][20]. Summary by Sections Financial Performance - The company expects a revenue decline of 2% in 2024, primarily due to poor downstream conditions, but anticipates a recovery in 2025 with a projected revenue increase of 17.18% [2][10]. - The forecasted net profit for 2025-2027 is RMB 5.9 billion, RMB 8.5 billion, and RMB 11.0 billion, representing year-on-year growth rates of 26%, 46%, and 29% respectively [5][19]. Revenue Breakdown - The detector segment is expected to grow at rates of 16%, 19%, and 19% from 2025 to 2027, with a recovery in demand from the medical and dental sectors [12][17]. - The core components segment is projected to see revenue growth of 43%, 39%, and 28% over the same period, driven by advancements in high-voltage generators and ray sources [13][17]. - The solutions and technical services segment is anticipated to grow significantly, with expected revenues of RMB 350 million, RMB 500 million, and RMB 700 million from 2025 to 2027 [14][17]. Valuation - The target price for the company is set at RMB 132, based on a price-to-earnings (PE) ratio of 45 times for 2025, reflecting a significant adjustment from previous estimates due to overall market conditions [5][20]. - The company's market capitalization is approximately RMB 17.36 billion, with a closing price of RMB 86.70 as of July 2, 2025 [7][10].

Core Viewpoint - Yirui Technology (688301.SH), a domestic core component supplier for medical imaging, is accelerating its industrial layout through an investment of up to 1.8 billion yuan in a silicon-based OLED microdisplay backplane production project [1][2]. Investment and Expansion - The company plans to increase its investment in its wholly-owned subsidiary, Yirui Imaging Technology (Hefei) Co., Ltd., by 600 million yuan to implement the silicon-based OLED microdisplay backplane production project [2][3]. - The project aims to add a production capacity of 5,000 units per month, with a construction period of 12 months and an expected payback period of 6.7 years, yielding an internal rate of return of 11.01% [2][3]. R&D Investment - From 2020 to 2024, Yirui Technology's cumulative R&D investment reached 1.053 billion yuan, with annual investments showing a growth trend: 96 million yuan in 2020, 146 million yuan in 2021, 239 million yuan in 2022, 262 million yuan in 2023, and 310 million yuan in 2024 [3][4]. Market Position and Performance - Yirui Technology is a leading player in the digital X-ray detector market, with production bases located in Shanghai, Jiangsu, Zhejiang, and Seoul, South Korea [4]. - In 2024, the company reported a revenue of 1.831 billion yuan, a year-on-year decrease of 1.74%, and a net profit of 465 million yuan, down 23.43% [5][6]. Globalization Efforts - In 2024, Yirui Technology enhanced its global presence by establishing sales or customer service platforms in the United States, Germany, and South Korea [6]. - The company also plans to issue shares to specific investors to raise funds for the construction of X-ray vacuum devices and comprehensive solution projects, which will add significant production capacity [6].

Core Viewpoint - The article discusses the rising investment in the Micro OLED sector driven by the increasing demand for AR glasses and the establishment of new production projects by various companies in the industry [1][11]. Company Investment - Yisui Technology plans to invest up to 1.8 billion yuan in a Micro OLED micro-display backplane production project, with an additional 600 million yuan allocated to its wholly-owned subsidiary, Yisui Imaging Technology (Hefei) [2][5]. - The project aims to add a production capacity of 5,000 units per month to meet specific customer demands, particularly from Shiya Technology [5][6]. Industry Development - The Micro OLED sector is experiencing a surge in project launches, with multiple companies, including Hongxi Technology and Xitai Technology, announcing significant investments and new production lines [7][9]. - Shiya Technology currently operates a 12-inch evaporation line capable of producing 9,000 wafers per month, with plans to expand to three lines producing 27,000 wafers per month [7][10]. Market Demand - The demand for Micro OLED displays is expected to grow, particularly in AR glasses, where it is projected to account for 54% of the market share by 2024 [10]. - Micro OLED technology is also anticipated to find applications in various fields, including security monitoring, digital camera viewfinders, military targeting devices, medical equipment, industrial inspection, and automotive displays [10][11]. Future Outlook - The Micro OLED technology is expected to see further development by 2025, leading to increased investments in upstream core component projects and a more mature industry chain [11].

Investment Overview - The company plans to invest up to RMB 1.8 billion (approximately USD 270 million) in the silicon-based OLED microdisplay backplane production project, with an increase of RMB 600 million (approximately USD 90 million) to its wholly-owned subsidiary, Yirui Imaging Technology (Hefei) Co., Ltd [3][4] - The investment aims to enhance production capacity by adding 5,000 units per month and achieving large-scale production [4] Decision and Approval Process - The investment proposal was approved during the 15th meeting of the company's third board of directors on May 23, 2025, and will be submitted for shareholder approval [2][3] Project Background - The company aims to establish a partnership with Shiya Technology and specific clients, where Shiya Technology will provide silicon-based OLED microdisplay module products, and the company will supply the necessary core materials [3][4] - The project leverages existing production lines for CMOS sensors, allowing for efficient production of the new backplane [4] Impact on the Company - The investment is expected to create strong synergies with existing operations, enhance technological innovation, and improve collaboration with downstream clients, thereby strengthening the company's competitive edge [4] - The funding will come from the company's own resources and a performance bond from Shiya Technology, ensuring no adverse impact on normal operations [4]

Core Viewpoint - The company plans to invest in a silicon-based OLED microdisplay backplane production project in collaboration with Visionary Technology and specific clients [1] Group 1: Investment Details - The company intends to invest no more than 1.8 billion yuan in the project, with an additional 600 million yuan allocated for capital increase in its wholly-owned subsidiary, Yirui Hefei [1] - The investment will be funded through the company's own funds and a deposit provided by Visionary Technology [1] Group 2: Production Capacity - Upon completion of the project, the company will add a production capacity of 5,000 silicon-based OLED microdisplay backplanes per month [1] - The project aims to achieve large-scale mass production of the backplanes [1]

Group 1 - The company plans to increase capital by 600 million yuan for its wholly-owned subsidiary, Yirui Hefei, and invest up to 1.8 billion yuan in the construction of a silicon-based OLED microdisplay backplane production project [1] - The project is expected to have a construction period of 12 months, an internal rate of return of 11.01%, and a payback period (after tax) of 6.7 years [1] - The funding sources for the project will be the company's own and self-raised funds, as well as a performance bond from Shiya Technology Co., Ltd. [1] Group 2 - The project aims to add a production capacity of 5,000 silicon-based OLED microdisplay backplanes per month to meet the demands of specific customers and Shiya Technology [1]