Core Insights - Yongxin Optical is recognized as a national-level manufacturing champion and has entered a new phase of domestic substitution in high-end optical microscopes [1] - The high-end optical microscope market in China has significant potential but has been dominated by foreign companies for a long time [1] - The company has developed technical capabilities comparable to top global optical microscope manufacturers through OEM, industry-academia-research collaboration, and undertaking major national projects [1] Industry Summary - The high-end microscope segment has seen rapid growth, achieving over 5% domestic substitution and further increasing market share year-on-year [1] - In 2024, the company's microscope business revenue is expected to decline by 14% to 356 million yuan due to industry demand recovery and equipment update policies, raising concerns about the pace of domestic substitution [1] - Despite the overall revenue decline, high-end microscope revenue continues to grow [1] - The implementation of China's scientific instrument domestic substitution strategy and increasing uncertainty in the international trade environment are expected to accelerate breakthroughs in the company's optical microscope business [1] - Increased funding for equipment updates in 2025, with the first batch of funds already allocated and the second batch undergoing project review, is anticipated to expedite the procurement process for high-end microscopes [1] - The company's microscope business is projected to resume growth starting in 2025 [1] Valuation Summary - Based on comparable companies' 2025 price-to-earnings (PE) ratio of 44 times, the target price is set at 110.88 yuan, maintaining a "buy" rating [1]

Core Viewpoint - The article highlights the emergence of domestic high-end life science instruments in China, driven by government support for technological innovation and the efforts of local researchers, marking the beginning of a "domestic substitution" trend in the market [2][5]. Group 1: Market Overview - In recent years, the market for high-end life science instruments has been dominated by foreign companies, with prices often exceeding millions, creating significant pressure on research funding and hindering the development of life science research in China [4]. - The recent bidding results from a major project by the Ministry of Education show that domestic instruments accounted for less than 20% of the total, with only four million-level domestic instruments selected, including products from Ai Rui Technology and Su Yuan Gene [3][4]. Group 2: Key Instrument Categories - **Gene Sequencing Instruments**: The market has seen a significant shift with domestic brands gaining ground, particularly after the ban on certain foreign products. Domestic brands like BGI have increased their market share, with high-throughput sequencing instruments typically priced over one million [6]. - **High-End Optical Microscopes**: Domestic companies have made notable advancements in various types of high-end optical microscopes, achieving varying degrees of domestic substitution in categories such as super-resolution and confocal microscopes [7][8]. - **Electron Microscopes**: The domestic market for scanning electron microscopes, previously dominated by foreign brands, is now seeing the emergence of local companies like Guoyi Quantum and Zhongke Keyi, with significant breakthroughs in technology and product offerings [14]. - **Flow Cytometers**: The domestic flow cytometer market is rapidly evolving, with numerous local manufacturers entering the field, although foreign brands still dominate in terms of bidding numbers [15]. - **Molecular Interaction Instruments**: Currently, about 90% of the market is still occupied by foreign brands, but domestic companies are quickly developing and selling products, with many priced over one million [17]. Group 3: Future Outlook - The article concludes that the trend of domestic high-end life science instruments is not only a technological advancement but also a significant step towards enhancing research autonomy in China. The expectation is for more innovative companies to join this movement, pushing Chinese high-end scientific instruments from emerging to globally leading positions [21].