HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Over 15 years' experience in both finance and healthcare, covering clinic operations, investment and equity research in both China and overseas.

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Equity Bottom-Up

Sonoscape Medical Corp / Equity Bottom-Up

<ul>
<li>Sonoscape maintained strong growth momentum in 23H1. Profit margin further improved. The Company has entered a stage where scale effect has emerged. However, declining contract liability balance raised our concern.</li>
<li>Japanese companies setting up factories in China would shake competitive landscape of the domestic market. The anti-corruption campaign could lead to “unexpected impact” on performance in 23H2. </li>
<li>We lowered 2023 revenue forecast to RMB2 billion. After negative factors are fully priced in, share price would rebound. </li>
</ul>


Sonoscape maintained strong growth momentum in 23H1. Profit margin further improved. The Company has entered a stage where scale effect has emerged. However, declining contract liability balance raised our concern.
Japanese companies setting up factories in China would shake competitive landscape of the domestic market. The anti-corruption campaign could lead to “unexpected impact” on performance in 23H2. 
We lowered 2023 revenue forecast to RMB2 billion. After negative factors are fully priced in, share price would rebound. 


High Conviction Update: Sonoscape (300633.CH) - Stock Price to Rebound After Temporary Headwinds