HeartCare Medical-B (06609.HK) Achieves First-Ever High-Quality Annual Profit, Marking a Turning Point in Performance and Valuation Recovery

Recently, HeartCare (06609) officially released its 2025 annual financial results.

The financial report shows that during the reporting period, the company achieved revenue of 408 million yuan, a year-on-year increase of 46.9%. At the same time, the company's gross margin remained stable at over 70%, and net profit reached 83.34 million yuan, reversing the previous loss with substantial profitability. Moreover, the company’s cash flow continued to improve, with operating cash flow reaching 155 million yuan during the period, demonstrating extremely strong internal growth capability.

Against the backdrop of ongoing volatility in the secondary market, HeartCare's robust performance has undoubtedly provided investors with a vote of confidence.

From September last year to now, affected by market liquidity and multiple external factors, the medical device sector of Hong Kong stocks has been constantly fluctuating. During this period, the Hang Seng Healthcare Index once fell nearly 30%. Behind this is not simply a rotation of funds, but a structural shift in market fund preferences. Investors are more willing to pay a premium for clear value realization.

On the day after the earnings report was disclosed, HeartCare's stock price rose sharply in the morning session, with an increase of nearly 8%, significantly outperforming the Hang Seng Index and the Hang Seng Healthcare Index, showing the market's high recognition of the company's annual report performance and fundamentals.

Benefiting from recent accumulations in innovative research and development as well as commercialization, HeartCare has now achieved an evolutionary upgrade from its neuro-intervention business to a focus on differentiated therapeutic devices, moving into the "2.0 phase" driven by therapeutic products. According to the annual report information, whether it is the strong performance growth or the robust risk resistance and organic growth capabilities reflected in the financial statements, HeartCare aligns with the current investment trends of the secondary market, establishing a key anchor point for the company's stock price to rebound first in the future.

"The Three Pillars" Accelerate the Realization of Innovative Value

As a leading innovative medical device company that has entered the stage of global commercial acceleration, the most core value evaluation anchor of HeartCare in 2025 lies in: unlike the Phase 1.0 which mainly relied on "key breakthroughs" in access products, the company has now entered Phase 2.0, where the "three-pronged approach" centered on therapeutic products has become an important driving force for the company to accelerate the realization of innovative value.

HeartCare, as the first interventional medical device company in China to provide a one-stop solution for stroke treatment and prevention, has been committed to advancing the evolution and upgrading of neurointerventional business towards differentiated therapeutic devices. The significant improvement in the company’s revenue structure and the accelerated growth in profitability by 2025 are concrete manifestations of the synergistic development of its "three-pronged" business segments in the financial report.

In 2025, the ischemic stroke business continued to play a significant cornerstone role in the company's financial report. During the period, the business's full-year revenue increased by 31.8% year-over-year.

The steady growth of cash cow businesses is backed by the continuous iteration of the company's ischemic product portfolio. During the period, the company’s intracranial thrombus aspiration catheter, which features differentiated competitive advantages, gained widespread clinical recognition. Its large-lumen aspiration and cascade aspiration technology (CATCH) received a Level I recommendation in the "Chinese Expert Consensus on Endovascular Treatment Techniques for Acute Ischemic Stroke 2025." This clear clinical endorsement has significantly accelerated the product’s adoption in hospitals. During the reporting period, the product has been introduced into over 450 hospitals, with a penetration rate of 26% in top-tier hospitals, driving sales growth of approximately 300%.

In addition to the robust performance of its cash cow business, HeartCare's "significant growth" in the bleeding business for 2025 was also a major highlight in the financial report.

With the successive launches of its intracranial stents, embolic coils, and flow diverter devices, HeartCare has officially established a "complete China-produced aneurysm treatment solution," smoothly entering a growth phase in 2025, with revenue increasing by 223.2% year-over-year in 2025.

Among them, the heavy-hitter intracranial stent, which received NMPA innovative medical device designation, was used in approximately 500 hospitals in its first commercial year, driving a rapid increase in the market share of embolic coils. Meanwhile, the approval and launch of the flow diverter during this period further completed an important piece of HeartCare’s hemorrhagic business.

In the interventional access business, thanks to the significant scale-up of the company's star product, the vascular closure device, which has been introduced into more than 1,800 hospitals and exceeded 200,000 units in annual end-user clinical usage, HeartCare achieved a single-product revenue of over 100 million yuan during the period, becoming an important contributor to the company’s performance. Meanwhile, the company is actively promoting the development and commercialization of its second-generation vascular closure device, further solidifying its leading position in this field by simultaneously managing two generations of access products.

It is not difficult to see that, driven by its strong registration and commercialization capabilities, HeartCare's differentiated innovative R&D is gradually turning into abundant commercialization results. The synergistic resonance of multiple business segments further strengthens the company’s innovation and commercialization foundation, while also giving investors sufficient confidence that the subsequent pipeline products expected to be launched by the company have the potential to replicate the commercial success path of HeartCare's various key product lines, continuously improving the company's "innovation-value" positive cycle.

Refined Operations Raise the Safety Margin

For HeartCare, driven by the synergistic growth across multiple business segments and the scale effects from commercialization progress, the company's operating cash flow reached 155 million yuan during the period, with total cash and deposits amounting to 786 million yuan. Meanwhile, the company achieved its first annual profit during this period, indicating that HeartCare has steadily entered a "innovation-profit" positive cycle. Behind this achievement, meticulous operations in all aspects from sales to R&D were indispensable.

During the reporting period, HeartCare demonstrated a significant aspect of its refined operations through the continuous improvement in the company's cost structure.

The financial report shows that the company's sales and management expense ratio decreased from 49.6% in 2024 to 45.8% in 2025. In terms of R&D expenses, as the innovation-commercialization transformation capability improves and the research phase of key pipeline products reaches a more mature and high-certainty middle-to-late stage, the company has maintained overall R&D investment at approximately 10% through refined management.

In addition,精细化运营 (refined operation) has also accelerated the scaling up of the company's products and the improvement in process maturity, which is reflected in the financial report as a steady increase in the company’s profitability: the gross margin for the period increased from 65.4% in 2024 to 70.9%, rising by 5.5 percentage points.

Multiple Benefits Set to Explode

智通财经APP observed that the Hong Kong stock innovative pharmaceuticals and medical devices sector experienced a collective surge, driving the Hang Seng Healthcare Index to a nearly 10% increase within seven days. This round of暴涨 is not driven by short-term sentiment but rather the entry into the payoff period for the industry's long-accumulated research and development results, coupled with the concentrated release of positive product sales performance.

Under this logic, the secondary market has also started to speculate in advance on some key targets with both outstanding performance and multiple impending favorable factors. HeartCare is one of them. In the past seven days, HeartCare's stock price has continued to rise, with a total increase of 13.5% during this period, significantly outperforming the index.

Behind this lies the investors' early "bet" before the realization of various benefits such as the company's overseas layout, cutting-edge technology development, and capital market strategies.

In terms of overseas expansion, based on current achievements during the reporting period, HeartCare's thrombectomy stent, occlusion balloon catheter, distal access catheter, and microcatheter have successfully obtained CE or FDA certification. The company has also secured 56 registration certificates across 13 other countries and regions. This is reflected in the financial report, which shows that HeartCare’s overseas market revenue increased by 101.3% year-over-year in 2025. This indicates that while enhancing the market share of domestically produced products in China, HeartCare is also actively expanding overseas, with a new growth engine beginning to take shape.

Currently, HeartCare's overseas business is proceeding in an orderly manner, with product registrations advancing steadily. To date, the company is conducting over 130 product registration processes across 29 other countries and regions, continuously expanding broader sales channels. During this earnings call, the company’s management also set a clear target for overseas business to contribute 10% of revenue by 2028.

In terms of cutting-edge technology layout, HeartCare's investment in brain-computer interfaces is undoubtedly the biggest highlight. As one of the earliest medical device companies in China to invest in brain-computer interfaces, HeartCare is now at the forefront of this field in the country.

In December last year, the "Interventional Brain-Computer Interface System for Motor Dysfunction" project submitted by HeartCare was successfully selected for the 2025 Artificial Intelligence Medical Device Innovation Task list. During a recent Investor Open Day, HeartCare not only introduced the technical solution of its interventional brain-computer interface system but also stated that the company has completed multiple rounds of animal experiments and verified key functions. The plan is to complete the first human clinical trial in 2026 and submit a registration application in 2028.

From a market perspective, according to forecasts by investment institutions such as McKinsey, the global market size for medical applications of brain-computer interfaces is expected to reach between 40 billion and 145 billion US dollars by 2030-2040. In this early-stage blue ocean market, HeartCare is poised to leverage its first-mover advantage and deep technological accumulation to build a technological moat for the company over the next 5-10 years, taking the lead in benefiting from the development dividends of this multi-billion-dollar track.

Conclusion

From the perspective of capital and market, the continuous adjustment of the innovative drug and device sector was partly due to the weak liquidity in the Hong Kong stock market. However, during the adjustment process in the secondary market, the industry has reached a critical point of transition from "quantitative change" to "qualitative change" and from "investment phase" to "harvest phase." This has also led to a significant divergence between the overall stock price performance and the strong fundamentals of leading innovative drug and device companies like HeartCare.

HeartCare is one of the few innovative pharmaceutical and medical device companies listed under Hong Kong's 18A category that has consistently rewarded investors through ongoing share buybacks. According to Zhitong Finance APP, over the past year, HeartCare has executed share repurchases 30 times, accumulating nearly 1 million shares bought back, with a total repurchase amount close to HKD 60 million, demonstrating the company’s strong commitment to shareholder returns. It is reported that the company also plans to submit an application for listing on China’s STAR Market within this year, aiming to further enhance shareholder returns and stock market liquidity by accessing the domestic capital market.

Against this backdrop, considering that HeartCare's current valuation has entered an evidently undervalued range, once market sentiment stabilizes and the sector trend reversal is confirmed, the company's stock price is expected to be the first to break out of the volatility range, demonstrating considerable upward elasticity to market investors.