CICC: Maintain YIDU TECH (02158) Outperform rating with a target price of 6.8 Hong Kong dollars.

Zhongjin released a research report stating that it maintains the revenue forecast for YIDU TECH (02158) for the fiscal years 2026 and 2027. Considering the company's cost control, the forecasted net profit attributable to the parent company for the fiscal years 2026 and 2027 has been adjusted from -45.69 million yuan and 4.11 million yuan to 410 thousand yuan and 54.57 million yuan, respectively. The rating of outperforming the industry is maintained with a target price of 6.8 Hong Kong dollars (based on 8 times the fiscal year 2026 P/S). The company is currently trading at 6 times the fiscal year 2026 P/S, with the target price from the bank indicating a 33% upside potential. Key points from Zhongjin include: Revenue for the first half of fiscal year 2026 meets expectations YIDU TECH announced its performance for the first half of fiscal year 2026: revenue of 360 million yuan, an increase of 8.7% year-on-year, which basically meets the bank's previous expectations; net loss has significantly narrowed by about 72% compared to the same period last year. Driven by "Data Elements x AI Technology," building a medical AI infrastructure In the first half of fiscal year 2026, revenue from big data platforms and solutions increased by 14.6% year-on-year to 153 million yuan, mainly benefiting from the expansion of business opportunities brought by policy initiatives. The company focuses on investing in a large-scale medical natural language model with 70 billion parameters. The AI platform supports the innovative applications in multiple hospitals and medical beauty scenes, and explores cooperation in AI digital avatars with leading hospitals. Revenue from life science solutions in the first half of the year decreased slightly by 4.4% to 138 million yuan, as the company promotes the deep integration of AI technology into the entire clinical trial process. As of September 30, 2025, among the top 20 multinational pharmaceutical companies, 17 are clients of YIDU TECH. Revenue from health management platforms and solutions in the first half of the year increased by 30.3% year-on-year to 66.67 million yuan, with the Hui Min Bao project serving in 5 provinces and 13 cities. Among them, the number of insured individuals in Shenzhen Hui Min Bao exceeded 6.15 million in 2025, reaching a historic high. Firm business focus, continued trend of loss reduction In the first half of fiscal year 2026, the company's gross profit margin showed improvement, with an overall gross profit margin increasing by 1.8 percentage points year-on-year to 37.4%, and the gross profit margin for big data platforms and solutions increasing by 5.1 percentage points year-on-year to 42.5%. The company continues to optimize internal operations, strengthen synergy between business segments, and narrow the net loss to 15.76 million yuan in the first half of the year, a 72% decrease in loss compared to the same period last year. In terms of cash flow, through strengthening fund management and efficiency in use, the company's net cash outflow from operating activities in the first half of the year decreased by 56% year-on-year.