A domestic leader in electrophysiology and vascular intervention, Mindray enters to enable R&D and sales at home and abroad. The company was founded in 2002. At the beginning of its establishment, it focused on electrophysiological devices. Since then, it has expanded horizontally into the fields of coronary access, peripheral intervention and non-vascular intervention. The product matrix has become increasingly rich, and channel expansion has continued to accelerate. In the field of electrophysiology, 2024H1 covered more than 1,250 hospitals (2024H1 added more than 150), and completed about 7,500 3D electrophysiology surgeries (an increase of more than 100%). In the field of vascular intervention, the 2024H1 peripheral line of admissions increased by more than 30%, and the coronary line increased by nearly 20%, covering nearly 4,000 hospitals. Product+channel dual advantages drive steady and high growth in performance. In 2017-2023, the company's revenue increased from 0.153 billion yuan to 1.65 billion yuan, and the CAGR reached 48.61%. Mindray Healthcare's acquisition of Huitai in 2024 will cooperate in formulating development strategies, R&D and marketing systems to enhance the global competitiveness of the company's products.

In the 10 billion electrophysiological blue ocean market, the ambition to replace domestic production is on the way. The electrophysiology industry is booming. The size of the electrophysiological device market in China increased from 2.424 billion yuan in 2017 to 6.58 billion yuan in 2021 (CAGR is 28.36%), and is expected to reach 15.726 billion yuan in 2025. The domestic electrophysiological device market is dominated by importers. Johnson & Johnson, Abbott, and Medtronic together accounted for 86.9% of the market share in 2020. The company has a complete line of electrophysiology products, a comprehensive layout of equipment and consumables, and increased product performance.

New products are entering the release cycle, and the company's electrophysiology business revenue increased steadily, from 0.097 billion yuan in 2017 to 0.368 billion yuan in 2023, with a CAGR of 24.86%. In addition, pulse ablation products, high-density catheters, pressure-sensing catheters, etc. in research projects have entered the registration review stage, and the product layout continues to expand, and the competitive advantage continues to be consolidated.

The number of PCI surgeries has increased steadily, and coronary access products are being collected to accelerate the release. Demand for PCI surgery continues to unleash, driving the coronary access market to surpass. China's PCI equipment market is 1.27 billion US dollars in 2021, and is expected to reach 3.751 billion US dollars in 2030, with a compound annual growth rate of 12.78%. The company actively embraces collection, and products such as coronary balloons, catheters, and contrast catheters have been selected one after another to drive the rapid release of coronary pathway products. Coronary pathway business revenue increased from 0.01 billion yuan to 0.791 billion yuan in 2017-2023, with a CAGR of 105.77%

Peripheral interventions are poised to begin, and non-vascular interventions create new superpoints. Peripheral interventional treatment in China is in the early stages of development, and the penetration rate of peripheral PTA surgery in 2021 was only 0.6%. China's peripheral interventional device market increased from 3.5 billion yuan in 2015 to 18.6 billion yuan in 2023, with a compound growth rate of 23.22%. The research project is progressing smoothly. The thoracic aortic laminating stent system has obtained a registration certificate, and the venous venous filter has entered the registration review stage. The company is actively laying out a non-vascular intervention product line with the aim of creating new performance gains.

Profit forecast and valuation: We expect the company's revenue for 2024-2026 to be 2.083, 2.727, and 3.578 billion yuan, respectively, with increases of 26.2%, 30.9%, and 31.2%, respectively; net profit to mother will be 0.707, 0.955, and 1.276 billion yuan, respectively, with increases of 32.4%, 35.1%, and 33.7%, respectively. For the first time, we covered the “buy” rating.

Risk warning: New product sales promotion falls short of expectations; policy risks; R&D progress falls short of expectations, risk of data lag behind.