Investment Rating - Maintain Outperform rating [4][13] Core Views - Revenue for the first three quarters of 2025 was RMB 336 million, with net profit attributable to shareholders at RMB 42 million and recurring NPAtS at RMB 24 million. Q3 revenue was RMB 113 million, net profit attributable to shareholders was RMB 9 million, and recurring NPAtS was RMB 3 million [4][13] - Given stable performance and successful overseas expansion, EPS forecasts for 2025-2027 remain at RMB 0.16/0.25/0.37. With sector valuation rising, 2025 target PS is 28X, target price is RMB 29.22, maintaining Outperform rating [4][13] - R&D layout improves, self-developed PFA expected to be approved in 2025. The PFA product of the associate company Shangyang Medical was approved in April 2025, with nationwide listing nearly complete by October 2025. Commercial surgeries are progressing well [4][13] - The company's self-developed pressure pulse PFA product has applied for registration with the National Medical Products Administration, expected approval in 2025 [4][13] - Overseas market grows rapidly, with expansion in Europe, Middle East and Africa, Latin America, and Asia-Pacific. In the first three quarters of 2025, the top three regions had similar market shares, with the highest growth in Latin America, Europe, and Middle East and Africa [4][13] Financial Summary - Total revenue for 2023A is RMB 329 million, with a projected increase to RMB 491 million in 2025E, reflecting a growth rate of 26.5% in 2023A and 18.9% in 2025E [3][4] - Net profit attributable to shareholders is projected to grow from RMB 6 million in 2023A to RMB 76 million in 2025E, with an impressive growth rate of 815.4% in 2024A [3][4] - Gross profit margin (GPM) stable at 59.09% with a slight increase of 0.30 percentage points, while net profit margin (NPM) at 12.46% shows a decrease of 1.88 percentage points [4][13]

Macro and Strategy - The equity market is currently in an accelerating upward phase, prompting discussions on how to adjust positions to prepare for potential market fluctuations [8] - Investors are advised to consider right-side position reduction as a more reasonable choice, given the current market dynamics [8] - Historical data suggests that low-priced convertible bonds (priced between 110-115 yuan) tend to be more resilient during market downturns [8] Company and Industry Analysis - **Dengkang Dental (001328.SZ)**: The company reported a stable growth in Q2 2025, with revenue reaching 842 million yuan, a year-on-year increase of 19.72%, and a net profit of 85 million yuan, up 17.59% [10][11] - **Marubi Biotechnology (603983.SH)**: The company achieved a revenue of 1.769 billion yuan in H1 2025, a 30.83% increase year-on-year, while net profit grew by 5.21% to 186 million yuan [13][14] - **Haidi Lao (06862.HK)**: The company reported a revenue of 20.7 billion yuan in H1 2025, a decrease of 3.7%, with core operating profit down 14% [17][18] - **Green Tea Group (06831.HK)**: The company achieved a revenue of 2.29 billion yuan in H1 2025, a 23.1% increase, with adjusted net profit rising by 40% [19][20] - **Haisco Pharmaceutical (002653.SZ)**: The company reported a revenue of 2 billion yuan in H1 2025, an 18.6% increase, with anesthetic product revenue growing by 54% [22][23] - **Furui Co., Ltd. (300049.SZ)**: The company achieved a revenue of 713 million yuan in H1 2025, an 11.02% increase, while net profit was impacted by foreign exchange losses [26][27] - **Kaili Medical (300633.SZ)**: The company reported a revenue of 964 million yuan in H1 2025, a decrease of 4.78%, with net profit down 72.43% due to high initial investments in new product lines [29][30] - **Yuyue Medical (002223.SZ)**: The company reported a revenue of 4.659 billion yuan in H1 2025, an 8.2% increase, with net profit rising by 7.4% [31][32]