Guotou Securities has issued a research report initiating coverage on XUNFEIHEALTH (02506), assigning a 'Buy-A' investment rating. Based on a 2026 dynamic price-to-sales ratio of 9x, the firm set a 6-month target price of HK$105.54. XUNFEIHEALTH is a leading AI healthcare enterprise in China. In the context of accelerating AI and large language model adoption, with healthcare being one of the first sectors to see implementation, the company leverages its strong AI capabilities to maintain high market share while actively expanding into new growth areas. The securities house forecasts the company's revenue for 2025 to 2027 to be RMB 925 million, RMB 1.256 billion, and RMB 1.577 billion, respectively. Key points from Guotou Securities are as follows.
Policy initiatives are driving the AI healthcare industry, and the company's business spans government, business, and consumer segments. In recent years, national policies have been introduced to support the development of AI in healthcare. The company has aligned its operations with these policies, focusing on primary care services, regional management platforms, hospital services, and patient services. Its comprehensive business model and client coverage across government, business, and consumer sectors position it as a leader in China's AI field. According to Deloitte forecasts, the market size for AI healthcare solutions is expected to exceed RMB 20 billion by 2025 and surpass RMB 100 billion by 2030, representing a compound annual growth rate of 43.2%.
The company is strengthening its AI technological barriers and deepening collaborations with top-tier hospitals. Leveraging the robust capabilities, such as intelligent speech recognition, of its parent company iFlytek's foundational models, XUNFEIHEALTH has independently developed the Spark medical large model and continues to upgrade it. The model ranked first in the MedBench evaluation, and in double-blind clinical comparative tests, its diagnostic and treatment capabilities have reached the level of an attending physician, significantly outperforming general-purpose large models. The company is also collaborating with top-tier hospitals like West China Hospital and Qilu Hospital to co-develop specialized disease models, promoting the clinical application of AI in key areas such as cardiovascular and cerebrovascular diseases, thereby enhancing technical reliability and commercial scalability.
The company maintains a leading advantage in the government sector while accelerating expansion into the business segment. Its core government product, the Intelligent Medical Assistant, has been deployed in over 800 districts and counties across 31 provinces and municipalities, serving more than 77,000 primary care institutions. It has cumulatively provided over 1.1 billion AI-assisted diagnostic suggestions, becoming a practical example of the deep integration of general medical AI scenarios with specialized public health scenarios. For grade-A hospitals, the company offers a smart hospital solution that comprehensively covers pre-diagnosis, during-diagnosis, and post-diagnosis stages. The pre-diagnosis phase includes intelligent triage and medical history collection systems; the during-diagnosis phase provides an intelligent companion system for patients and the iDoctor intelligent workstation for physicians; the post-diagnosis phase offers intelligent tools for follow-up management, patient follow-ups, and satisfaction surveys.
By extending its service chain, the consumer patient segment is poised to become a new growth driver. With increasing public willingness to pay for health services and policy focus on service continuity, the company is actively developing AI products for patients. Utilizing speech recognition and large model technology, it provides services such as intelligent follow-ups and personalized health management. Through AI-enabled refined patient management, the company is expected to form a closed-loop service from doctors to patients, unlocking a new cycle of growth momentum.
Risk factors include potential shortfalls in downstream demand, slower-than-expected technological iteration, intensifying industry competition, delays in commercial implementation, business compliance and regulatory risks, reliance on local resources for regional business expansion, and unforeseen delays in project acceptance and payment collection.
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