The Zhitong Finance App learned that Goldman Sachs released a research report stating that it maintained the “buy” rating of Weigao shares (01066), lowered its 2023-2025 earnings forecast by 16.1%, 15.7% and 16.3%, respectively, and lowered the target price by 10.7% to HK$10 from HK$11.2. The bank expects the company to return to double-digit growth levels starting in 2024. Regarding the results issued in March, the focus will be on its 2024 financial guidelines and the progress of spinal cord inventory compensation.

The bank pointed out that Weigao Co., Ltd.'s profit warning for 2023 was based on the median data, that is, sales for the second half of 2023 fell 5% year on year to 6.2 billion yuan, lower than Goldman Sachs's forecast of 6.7 billion yuan. Net profit decreased 35% year on year, and net interest rate was 12. %, lower than Goldman Sachs's estimate of 17.1%. Reasons for poor performance include: the impact of pharmaceutical volume procurement (VBP) was worse than expected, particularly poor orthopedic inventory compensation, and orthopedic profits fell sharply; a high base of pandemic-related products in general consumer goods in the second half of 2022; and increased financing costs due to the Federal Reserve's interest rate hike.