31 Aug 2026 CMB International Global Markets | Equity Research | Company Update

Mindray (300760 CH)

1H26 in line; overseas momentum and domestic recovery intact

Mindray reported 1H26 revenue of RMB17.75bn (+6.0% YoY) with 2Q26 growth accelerating to 10.5% YoY, broadly in line with our expectations. Attributable net profit decreased 3.6% YoY to RMB5.05bn, mainly due to FX losses. Excluding FX impact, net profit grew 8.7% YoY in 1H26. We leave our 2026E-28E revenue forecasts largely unchanged, which continue to assume a recovery in the domestic business and sustained solid growth overseas. We lower our 2026E earnings forecast to reflect near-term FX headwinds, while keeping our 2027E28E earnings estimates broadly unchanged.

 Overseas businesses remained strong led by Europe and emerging markets. Overseas revenue reached RMB9.5bn (+13.7% YoY; +18.4% in USD terms), accounting for 53% of the total in 1H26. Europe remained the standout, with revenue up nearly 25% YoY. Key markets including the UK, France and Italy each delivered growth of over 30% YoY. Latin America grew nearly 20% YoY, while APAC rose 17% YoY in 1H26, supported by strong performance in India, Mexico and Brazil. Notably, growth was broadbased across product lines. Overseas IVD revenue increased 21% YoY, with immunoassay up 30% YoY. Overseas PMLS grew over 10% YoY, and overseas ultrasound delivered high-single-digit growth. We expect Europe, Latin America and APAC to drive continued double-digit overseas growth in 2026E.

 Domestic recovery appears to be underway. Domestic revenue was RMB8.3bn (-1.6% YoY), but we estimate 2Q26 already returned to positive growth (+~8.8% YoY). Emerging businesses and IVD are increasingly the main growth engines domestically. In 1H26, domestic emerging businesses rose 21% YoY and accounted for 24% of domestic revenue; together with IVD, they represent 74% of total domestic revenue. Mindray continued to gain market share in core IVD categories (CLIA, chemistry, coagulation), with share rising from 10% in 1H25 to 14% in 1H26. Its TLA installed base also expanded rapidly. In 1H26, Mindray secured over 260 new TLA orders and completed nearly 200 installations, driving an upward revision to its fullyear TLA order intake target. Therefore, we continue to expect domestic revenue to resume single-digit growth in 2026E, supported by IVD share gains, continued growth in emerging businesses, and an easier comparison base.

 Maintain BUY. We maintain our FY26E-28E revenue forecasts largely unchanged and derive our target price of RMB204.94 based on a 9-year DCF model (WACC: 9.1%, terminal growth: 3.0%; both unchanged). Risks: centralized procurement-driven price cuts; domestic procurement demand weakness; overseas expansion underperformance.

Earnings Summary

(YE 31 Dec) FY24A FY25A FY26E FY27E FY28E Revenue (RMB mn) 36,726 33,282 35,909 39,460 43,524

YoY growth (%) 5.1 (9.4) 7.9 9.9 10.3 Attributable net profit (RMB mn)

11,668 8,136 7,871 9,381 10,497

YoY growth (%) 0.7 (30.3) (3.3) 19.2 11.9 EPS (Reported) (RMB) 9.64 6.71 6.49 7.74 8.66 P/E (x) 17.1 24.5 25.3 21.2 19.0 Net gearing (%) (46.4) (46.4) (49.2) (52.6) (56.0) Source: Company data, Bloomberg, CMBIGM estimates

Mindray (300760 CH) - 1H26 in line; overseas momentum and domestic recovery intact

Target Price RMB204.94

(Previous TP RMB204.54)

Up/Downside 24.7% Current Price RMB164.30

China Healthcare Jill WU, CFA

(852) 3900 0842 jillwu@cmbi.com.hk

Cathy WANG

(852) 3916 1729 cathywang@cmbi.com.hk

Stock Data

Mkt Cap (RMB mn) 199,204.1 Avg 3 mths t/o (RMB mn) 1,520.0 52w High/Low (RMB) 248.24/133.98 Total Issued Shares (mn) 1212.4

Source: FactSet

Shareholding Structure

Smartco Development Limited 27.0% Magnifice (HK) Limited 24.5%

Source: SZSE

Share Performance

Absolute Relative 1-mth 9.1% 8.2% 3-mth 9.0% 16.2% 6-mth -11.6% -9.7%

Source: FactSet

12-mth Price Performance

Source: FactSet

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1

Figure 1: Earnings revision New Old Diff (%)

RMB mn FY26E FY27E FY28E FY26E FY27E FY28E FY26E FY27E FY28E Revenue 35,909 39,460 43,524 35,708 39,351 43,477 0.56% 0.28% 0.11% Gross profit 21,300 23,343 25,721 21,087 23,197 25,622 1.01% 0.63% 0.39% Operating profit 10,445 12,052 13,471 10,627 11,948 13,393 -1.72% 0.87% 0.58% Net profit 7,871 9,381 10,497 8,026 9,299 10,435 -1.93% 0.88% 0.59% EPS (RMB) 6.49 7.74 8.66 6.62 7.67 8.61 -1.93% 0.88% 0.59% Gross margin 59.32% 59.16% 59.10% 59.05% 58.95% 58.93% +0.26ppt +0.21ppt +0.16ppt Operating margin 29.09% 30.54% 30.95% 29.76% 30.36% 30.80% -0.67ppt +0.18ppt +0.15ppt Net margin 21.92% 23.77% 24.12% 22.48% 23.63% 24.00% -0.56ppt +0.14ppt +0.12ppt

Source：CMBIGM estimates

Figure 2: Risk-adjusted DCF valuation DCF Valuation (in RMB mn) 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E

EBIT 10,426 11,281 12,590 13,972 15,646 17,576 19,773 22,317 25,267 Tax rate 15.00% 15.00% 15.00% 15.00% 15.00% 15.00% 15.00% 15.00% 15.00% EBIT*(1-tax rate) 8,862 9,589 10,702 11,877 13,299 14,939 16,807 18,969 21,477 + D&A 1,817 1,851 1,838 1,838 1,831 1,814 1,794 1,768 1,736

• - Change in working capital -232 -283 -302 -297 -305 -625 -695 -792 -903
• - Capex -2,462 -2,362 -2,262 -2,162 -2,062 -1,962 -1,862 -1,762 -1,662

FCFF 7,985 8,795 9,976 11,256 12,764 14,167 16,044 18,184 20,648 Terminal value 349,046

Terminal growth rate 3.0% WACC 9.1% Cost of Equity 12.3% Cost of Debt 3.8% Equity Beta 0.90 Risk Free Rate 2.8% Market Risk Premium 10.5% Target Debt to Asset ratio 35.0% Effective Corporate Tax Rate 15.0%

Terminal value 159,482 Total PV 233,709 Net debt -20,593 Minority interest 5,823 Equity value 248,479 # of shares (mn) 1,212 DCF per share (in RMB) 204.94

Source: CMBIGM estimates

Figure 3: Sensitivity analysis (RMB)

Source: CMBIGM estimates

Figure 4: CMBIGM estimates vs consensus

CMBIGM Consensus Diff (%)

RMB mn FY26E FY27E FY28E FY26E FY27E FY28E FY26E FY27E FY28E Revenue 35,909 39,460 43,524 35,625 39,309 43,569 0.80% 0.38% -0.10%

• Gross profit 21,300 23,343 25,721 21,169 23,379 26,034 0.62% -0.15% -1.20% Operating profit 10,445 12,052 13,471 10,103 11,371 12,750 3.39% 5.99% 5.66% Net profit 7,871 9,381 10,497 8,323 9,520 10,724 -5.43% -1.46% -2.12% EPS (RMB) 6.49 7.74 8.66 6.94 7.99 8.86 -6.39% -3.16% -2.31% Gross margin 59.32% 59.16% 59.10% 59.42% 59.47% 59.75% -0.11ppt -0.32ppt -0.66ppt Operating margin 29.09% 30.54% 30.95% 28.36% 28.93% 29.26% +0.73ppt +1.62ppt +1.69ppt Net margin 21.92% 23.77% 24.12% 23.36% 24.22% 24.61% -1.44ppt -0.45ppt -0.5ppt

Source: Company data, Bloomberg, CMBIGM estimates

Financial Summary

INCOME STATEMENT 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Revenue 34,932 36,726 33,282 35,909 39,460 43,524 Cost of goods sold (12,513) (13,548) (13,208) (14,609) (16,117) (17,803)

• Gross profit 22,419 23,178 20,074 21,300 23,343 25,721 Operating expenses (9,478) (10,549) (10,401) (11,258) (11,413) (12,371) Selling expense (5,010) (5,283) (5,145) (5,386) (5,840) (6,398) Admin expense (1,524) (1,600) (1,551) (1,652) (1,776) (1,915) R&D expense (3,433) (3,666) (3,579) (3,699) (3,985) (4,309) Others 489 (1) (127) (522) 189 251 Gain/loss on financial assets at FVTPL 79 126 0 0 0 0 Investment gain/loss (10) 69 115 115 115 115 Other gains/(losses) 60 287 6 288 6 6 Operating profit 13,070 13,112 9,795 10,445 12,052 13,471 Others (59) (92) (121) (121) (121) (121) Pre-tax profit 13,011 13,020 9,674 10,324 11,931 13,350 Income tax (1,433) (1,280) (1,222) (1,549) (1,790) (2,003) Minority interest 4 (71) (316) (905) (761) (851) Net profit 11,582 11,668 8,136 7,871 9,381 10,497 Adjusted net profit 11,434 11,442 8,069 7,858 9,368 10,484

BALANCE SHEET 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Current assets 26,875 25,647 27,410 30,645 34,928 39,820 Cash & equivalents 18,787 16,644 17,690 20,597 24,253 28,458 Account receivables 3,297 3,226 3,410 3,383 3,501 3,623 Inventories 3,979 4,757 5,004 5,358 5,867 6,432 Prepayment 268 297 273 273 273 273 Other current assets 545 722 1,033 1,033 1,033 1,033 Non-current assets 21,065 30,997 31,857 33,377 34,482 35,500 PP&E 5,490 7,086 7,670 8,199 8,333 8,378 Deferred income tax 1,313 1,697 1,567 1,567 1,567 1,567 Intangibles 2,225 6,723 6,390 5,739 5,078 4,406 Goodwill 5,062 11,093 11,404 11,404 11,404 11,404 Other non-current assets 6,976 4,397 4,825 6,468 8,101 9,745 Total assets 47,940 56,644 59,267 64,021 69,410 75,320

Current liabilities 10,103 10,427 11,600 11,695 12,039 12,424 Short-term borrowings 8 5 0 0 0 0 Account payables 2,690 2,793 3,242 3,337 3,682 4,067 Tax payable 653 428 385 385 385 385 Other current liabilities 6,751 7,202 7,972 7,972 7,972 7,972 Non-current liabilities 4,491 5,458 4,656 4,656 4,656 4,656 Long-term borrowings 1 0 4 4 4 4 Deferred income 109 127 182 182 182 182 Other non-current liabilities 4,381 5,331 4,470 4,470 4,470 4,470 Total liabilities 14,594 15,885 16,255 16,351 16,695 17,080

Share capital 1,212 1,212 1,212 1,212 1,212 1,212 Capital surplus 608 608 608 608 608 608 Others 31,265 34,036 36,273 40,028 44,311 48,985 Total shareholders equity 33,085 35,856 38,093 41,848 46,131 50,805 Minority interest 261 4,902 4,918 5,823 6,583 7,434 Total equity and liabilities 47,940 56,644 59,267 64,021 69,410 75,320

CASH FLOW 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec (RMB mn) Operating Profit before taxation 11,578 11,740 8,451 8,776 10,142 11,348 Depreciation & amortization 1,039 1,503 1,747 1,817 1,851 1,838 Tax paid (1,433) (1,280) (1,222) (1,549) (1,790) (2,003) Change in working capital (1,652) (727) (439) (232) (283) (302)

• Others 1,528 1,196 1,608 1,774 1,545 1,648 Net cash from operations 11,062 12,432 10,145 10,586 11,465 12,529

Investing Capital expenditure (2,689) (1,959) (2,038) (2,000) (1,900) (1,800) Acquisition of subsidiaries/ investments (871) (5,773) 0 0 0 0

• Others 2,867 350 1,528 (462) (462) (462) Net cash from investing (693) (7,383) (509) (2,462) (2,362) (2,262)

Financing Dividend paid (10,670) (8,843) (5,743) (5,217) (5,447) (6,063) Net borrowings (19) (3) (3) 0 0 0 Proceeds from share issues 79 79 36 0 0 0 Others (166) (114) (1,014) 0 0 0 Net cash from financing (10,776) (8,882) (6,724) (5,217) (5,447) (6,063)

Net change in cash Cash at the beginning of the year 18,974 18,668 14,908 17,690 20,597 24,253 Exchange difference 101 72 (195) 0 0 0 Cash at the end of the year 18,668 14,908 17,625 20,597 24,253 28,458

GROWTH 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

Revenue 15.0% 5.1% (9.4%) 7.9% 9.9% 10.3% Gross profit 15.1% 3.4% (13.4%) 6.1% 9.6% 10.2% Operating profit 18.9% 0.3% (25.3%) 6.6% 15.4% 11.8% Net profit 20.6% 0.7% (30.3%) (3.3%) 19.2% 11.9% Adj. net profit 20.0% 0.1% (29.5%) (2.6%) 19.2% 11.9%

PROFITABILITY 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

Gross profit margin 64.2% 63.1% 60.3% 59.3% 59.2% 59.1% Operating margin 37.4% 35.7% 29.4% 29.1% 30.5% 31.0% Adj. net profit margin 32.7% 31.2% 24.2% 21.9% 23.7% 24.1% Return on equity (ROE) 35.6% 33.9% 22.0% 19.7% 21.3% 21.7%

GEARING/LIQUIDITY/ACTIVITIES 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

Net debt to equity (x) (0.6) (0.5) (0.5) (0.5) (0.5) (0.6) Current ratio (x) 2.7 2.5 2.4 2.6 2.9 3.2 Receivable turnover days 31.1 32.4 36.4 34.4 32.4 30.4 Inventory turnover days 116.7 117.7 134.9 133.9 132.9 131.9 Payable turnover days 72.6 73.9 83.4 83.4 83.4 83.4

VALUATION 2023A 2024A 2025A 2026E 2027E 2028E

YE 31 Dec

P/E 17.2 17.1 24.5 25.3 21.2 19.0 P/E (diluted) 17.2 17.1 24.5 25.3 21.2 19.0 P/B 18.6 18.0 16.3 16.2 15.8 15.3 Div yield (%) 3.5 3.8 2.7 2.6 3.1 3.4

Source: Company data, CMBIGM estimates. Note: The calculation of net cash includes financial assets.

Disclosures & Disclaimers

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CMBIGM Ratings

BUY : Stock with potential return of over 15% over next 12 months HOLD : Stock with potential return of +15% to -10% over next 12 months SELL : Stock with potential loss of over 10% over next 12 months NOT RATED : Stock is not rated by CMBIGM

OUTPERFORM : Industry expected to outperform the relevant broad market benchmark over next 12 months MARKET-PERFORM : Industry expected to perform in-line with the relevant broad market benchmark over next 12 months UNDERPERFORM : Industry expected to underperform the relevant broad market benchmark over next 12 months

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