Sinolink Securities released a research report stating that it has initiated coverage of LIFETECH SCI (01302), giving it a "Shareholding" rating and is Bullish on the company's long-term development in the field of cardiovascular intervention, estimating the company’s revenue for 2024-2026 at 1.256/1.687/2.076 billion yuan, year-on-year -1%/+34%/+23%; net income attributable to shareholders at 0.294/0.373/0.466 billion yuan, year-on-year +12%/+27%/+25%. Target Price is 1.8 HKD/share.

Sinolink Securities' main points are as follows:

An innovative medical instruments company with a rich pipeline, focused on the research and development of cardiovascular intervention.

The company adheres to a development Global Strategy of "innovation" + "internationalization", maintaining a leading market share in domestic key products. Currently, the company has three main product lines, including structural heart disease Business, peripheral vascular disease Business, and pacing electrophysiology Business. The company achieved revenue of 1.267 billion yuan in 2023, a year-on-year increase of +15.5%; in the first half of 2024, it achieved revenue of 0.653 billion yuan, a year-on-year increase of +2.1%, maintaining a growth trend despite external environmental impacts.

The three major innovative product combinations for aortic intervention are about to be approved, forming a comprehensive intervention solution.

In 2021, the number of domestic aortic endovascular surgeries was 0.05 million, with a compound annual growth rate of 17.8% over the past four years. The number of global aortic disease patients reached 30 million, with 4 million in China, and the penetration rate remains low, indicating that the market is expected to maintain a high growth rate in the future. Currently, the company is researching three major innovative product combinations: chimney Brackets, fenestrated Brackets, and thoracic-abdominal main Brackets, all of which are in the registration approval process through the green channel for innovative devices in China. Once approved, it will establish a comprehensive product line for aortic intervention, enabling better response to market competition and pricing risks.

The company has developed a revolutionary iron-based Brackets technology, featuring both "support performance" and "absorbable" characteristics.

Since 2006, the company has been deeply engaged in the research and development of iron-based absorbable materials and instruments. By incorporating approximately 0.05wt.% nitrogen into high-purity iron, the 50 micrometer thick iron alloy Brackets achieve mechanical performance, clinical operability, and scope of indications comparable to mainstream permanent Brackets. In November, the IBS (Iron-based bioabsorbable Brackets) drug-eluting coronary Brackets system successfully completed one-year follow-up of Phase III clinical research, further proving the Brackets' ideal safety and efficacy. The product is expected to complete registration and approval in China within 2-3 years, showing great clinical application potential as a fully biodegradable metal coronary Brackets made of iron.

International expansion is progressing rapidly, and the Europe business is expected to strengthen further.

In 2023, the company achieved revenue of 0.275 billion yuan in overseas markets, a year-on-year increase of 36.0%. The company maintains a leading position in global expansion, having achieved substantial sales revenue in regions such as Europe and Asia-Pacific. Currently, the company covers nearly 120 countries and regions, with over 970 global agents. Products for structural heart diseases are widely recognized in Europe and other regions, and there is potential for further growth in the future.