Core Viewpoint - CICC maintains a "outperform" rating for Weigao Group (01066) with a target price of HKD 6.4, reflecting a price-to-earnings ratio of 9.3/8.2 times for 2025/2026 [1] Financial Performance - In 2024, Weigao Group reported revenue of RMB 13.09 billion, a year-on-year decrease of 1.1%, and a net profit attributable to shareholders of RMB 2.07 billion, which, after excluding one-time gains from 2023, represents a year-on-year increase of 4.2% [1] - The breakdown of revenue by business segment shows: - Medical devices revenue at RMB 6.51 billion, down 6.5% year-on-year, with operating profit of RMB 1.07 billion, up 1% [2] - Orthopedic revenue at RMB 1.44 billion, up 13.2% year-on-year, with operating profit of RMB 0.22 billion, up 196% [2] - Pharmaceutical packaging revenue at RMB 2.28 billion, up 12.6% year-on-year [2] - Interventional segment revenue up 2.5% year-on-year [2] - Blood management revenue at RMB 0.88 billion, down 15.8% year-on-year, with operating profit down 41.4% [2] Growth Potential - The company is expected to enter a double-digit growth phase as it develops new business lines, including perioperative products, urology, endocrinology, endoscopy, and intravenous therapy in the medical device segment, as well as artificial bones and sports medicine in orthopedics [3] - The anticipated revenue growth rate for 2025 is projected to be between 10-15% due to the positive outlook on both new and existing business lines [3] Shareholder Returns - Weigao Group announced a final dividend of RMB 0.1235 per share, raising the total dividend payout ratio for 2024 to 50% [4] - The company is expected to maintain a high level of dividends and has announced a share buyback program starting in February 2025 [4]