Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's performance in H1 2025 is under pressure, but there is optimism for a recovery in subsequent periods due to improving procurement trends [5] - The company reported a revenue of 9.64 billion yuan in H1 2025, a decrease of 4.78% year-on-year, with a net profit attributable to the parent company of 0.47 billion yuan, down 72.43% [5] - The decline in revenue and profit is attributed to delayed revenue recognition from procurement recovery, high inventory levels, significant investment in new production lines, and ongoing R&D and sales expenditures [5] - The company has adjusted its profit forecasts for 2025-2027, expecting net profits of 3.22 billion yuan, 4.44 billion yuan, and 5.64 billion yuan respectively, with corresponding EPS of 0.74 yuan, 1.03 yuan, and 1.30 yuan [5] Financial Summary - The total market capitalization of the company is 147.77 billion yuan, with a current stock price of 34.15 yuan [1] - The company’s revenue for 2023 is projected at 21.20 billion yuan, with a year-on-year growth of 20.3%, followed by a decline to 20.14 billion yuan in 2024 [8] - The gross margin is expected to decrease from 69.4% in 2023 to 63.8% in 2024, with a gradual recovery to 65.9% by 2027 [11] - The net profit margin is projected to drop from 21.4% in 2023 to 7.1% in 2024, before recovering to 16.9% by 2027 [11] Product and Market Insights - The company is focusing on R&D to enrich its product pipeline, with significant advancements in ultrasound and endoscopy products [6] - Domestic revenue in H1 2025 was 4.95 billion yuan, a decrease of 9.17%, while overseas revenue was 4.69 billion yuan, an increase of 0.33% [7] - The company is expanding its presence in high-end markets and leveraging local insights to drive new product launches [7]