Mindray (300760 CH)：Overseas strength offsets domestic softness251031

Mindray reported 9M25 revenue of RMB25.8bn, down by 12.4% YoY. Revenuein 3Q25 reached RMB9.1bn, up by 1.5% YoY, indicating a turnaround driven byaccelerating overseas growth and mild domestic recovery. Overseas revenuerose 12% YoY to RMB4.6bn in 3Q, with revenue from Europe up by 29%.Domestic revenue fell by 7% YoY in 3Q, while the decline narrowed notablycompared to 1H25. We anticipate a further acceleration in growth in 4Q25,supported by the ongoing recovery in domestic equipment procurement, solidoverseas momentum, and a favorable base effect.

IVD: solid overseas growth; accelerated TLA installation. In 3Q25, IVDsegment reported revenue of RMB3.6bn, down by 3% YoY, with overseasIVD revenue achieving double-digit growth.

TLA (Total LaboratoryAutomation) installations continued to accelerate. In 9M25, 180 units of theMT8000 TLA were installed in China, and full-year domestic deploymentsare expected to exceed 200 units, per company guidance. O verseasMT8000 sales surpassed 20 units, which has met the full-year target. Weexpect TLA systems to enhance Mindray’s penetration into leading domestichospitals and medium-to-high throughput labs overseas, supporting long-term IVD growth.

MIS: continued high-end upgrade. MIS segment reported revenue ofRMB1.7bn in 3Q25, roughly flat YoY. Overseas MIS grew at a high single-digit rate, while sales of ultra-high-end products doubled in 9M25. We seesignificant potential for market share gains in high-end and ultra-high-endultrasound, both domestically and internationally, driven by the risingadoption of Resona A20/ Nuewa A20 and upcoming launches in thepremium portfolio.

Profitability under headwinds. Mindray’s attributable net margin declinedto 29.3% in 9M25, down 7ppts YoY, mainly due to domestic pricing pressurefrom volume-based procurement (VBP) and intensified competition.Increased investment in overseas expansion also led to an increase inselling expenses. Going forward, we expect greater in-house reagent rawmaterial production, a higher mix of high-end products, and growingoverseas contribution to partly offset domestic margin pressure and supportsound long-term profitability.

Maintain BUY. Given continued demand and pricing pressure in the IVDsegment, we revise down our 2025E-27E forecasts and lower our targetprice to RMB249.21 based on a 9-year DCF model (WACC: 9.1%, terminalgrowth: 3.0%).