Tigermed - A/H CSRC investigation not a big concern, but weak earnings recovery leads to PT cuts

研报英文原文证据摘录

Tigermed - A/H CSRC investigation not a big concern, but weak earnings recovery leads to PT cuts

ities (China) Company Limited

had anticipated. Reflecting a more cautious view on margin recovery, we lower our

earnings forecasts and revise down our Dec-26 PTs for the H- and A-shares to HK

$39 and Rmb41, respectively. We maintain our N/UW ratings on Tigermed - H/A.

• CSRC investigation: minimal impact on daily operations. On May 12,

CSRC launched an investigation of Tigermed’s co-founders for alleged failure

to timely disclose a shareholding reduction since Dec 2014. We believe there

will be no major impact on its business operations and the investigation may

not take more than one month. However, we do not disregard the possibility of

the investigation resulting in a fine/penalty.

• Earnings recovery lagged expectations in 1Q26. Net profit attributable to

shareholders was Rmb49mn, -70% YoY due to a substantial increase in non-

controlling interest arising from a FV gain recorded by a subsidiary. Stripping

away one-offs and non-controlling interest, recurring net profit rose 18% YoY

to RMB120mn, which while positive fell short of our expectation for a >50%

YoY rebound embedded in our recovery thesis for FY26E. The softer earnings

trajectory indicates operating leverage and profitability normalization are

progressing more slowly than anticipated, raising concern over the

sustainability of a strong earnings rebound through the remainder of the year.

• Model update. We lower our FY26-28E recurring net profit forecasts by 12-

14%, driven mainly by a 2-3ppt reduction in gross margin assumptions, while

we leave our revenue forecasts unchanged. We now expect recurring net profit

to grow ~35% YoY in FY26E. Incorporating these revisions, we derive new