Kingmed (603882.SS): 1H26 Preliminary Net Profit Beats; New Equity Incentive Plan Launched; Buy
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Key Views
Kingmed launched a 2026 equity incentive plan with full vesting requiring 2026/2027/2028 revenue growth of at least 6%/14.5%/26% versus a 2025 base (implying roughly 6%/8%/10% annual growth), with adjusted net profit targets of RMB 390/500/600 million. Goldman Sachs believes these targets already account for risks from DRG 3.0 implementation and national medical service pricing standardization.
Goldman Sachs revised 2026–2028 forecasts: 2026 net profit raised 25.9% to RMB 415 million, 2027 up 1.2% to RMB 504 million, and 2028 down 4.1% to RMB 661 million. Revenue projections were cut for 2027 by 10.2% to RMB 702.4 million and 2028 by 15.8% to RMB 781.8 million.
Outlook
Industry consolidation is accelerating under compliance and DRG/DIP reforms, with supply-side capacity exiting. Normalized profitability appears to be stabilizing near an inflection point. Key risks include slower outsourcing demand recovery, persistent weakness in high-end testing, pricing pressure from VBP, and slower industry consolidation.
Recommended Securities
- Kingmed (603882.SS): Buy; 12-month target price of RMB 36 (based on 5-year exit P/E, 9.5% discount rate, 21.8x peer P/E).
Key exhibits
Exhibit 1
