Breaking through overseas! "Ventilator King" Li Xiting increases stake in Mindray Medical by 200 million

The inflection point for the medical device industry has not yet arrived, and the industry's "BD moment" still needs to wait.

Faced with continuously declining stock prices, Li Xiting, the "King of Ventilators," could no longer sit still and chose to repurchase shares.

Recently, Mindray Medical, the "top player in medical devices," announced that its chairman, Li Xiting, increased his holdings in the company by 152,300 shares on the same day, with the total amount nearing 30 million yuan.

In the shareholding increase announcement, Mindray Medical also stated that in the next six months, Chairman Li Xiting will continue to increase his holdings in the company, with the total amount reaching 200 million yuan (including this round of increase).

According to media statistics, this is the first time Li Xiting has increased his holdings since Mindray Medical's A-share listing in 2018.

In terms of stock performance, as of the latest closing, Mindray Medical's stock price has fallen below 200 yuan, with a total market value of 240.9 billion yuan. Against the backdrop of the Shanghai Composite Index briefly surpassing 4,000 points, Mindray Medical's year-to-date decline still exceeds 20%. If calculated from its peak, its market value has evaporated by over 300 billion yuan.

In terms of the effect of the shareholding increase, it has not achieved the goal of boosting the stock price.

Of course, the weak performance of Mindray's stock is mainly related to its operational conditions.

Financial report data shows that in 2024, Mindray Medical achieved revenue and net profit of 36.73 billion yuan and 11.67 billion yuan, respectively, with growth rates of 5.14% and 0.74%. Compared to the previous double-digit growth rates of over 20%, Mindray Medical's performance in 2024 has significantly slowed down. In the first three quarters of this year, Mindray Medical even experienced negative growth, with revenue growth at -12.38% and net profit growth at -28.83%.

Admittedly, the chairman's shareholding increase is a positive signal for the company's stock price, but if operational conditions do not improve, a mere 200 million yuan in repurchases may not be enough to lift the "top player in medical devices."

The Dilemma of Performance

To understand Mindray Medical's current predicament, we must first look back at how the "top player in medical devices" rose to prominence.

Records show that Mindray Medical was founded in 1991, initially starting as an importer of medical monitoring equipment. Soon, the founding team realized that without core technology, they would always be at the mercy of others. Thus, Mindray Medical shifted to independent R&D, successively developing China's first portable multi-parameter monitor and the first quasi-fully automated three-part hematology analyzer, establishing a pivotal position in the domestic medical device sector.

In the broader healthcare system, the medical device industry holds a crucial position. Unlike pharmaceuticals that directly treat diseases, medical devices are the "extended senses" and "core tools" of medical practice: from simple thermometers and syringes to complex MRI systems and even surgical robots, all fall under medical devices. Medical devices are integral to the entire process of disease prevention, diagnosis, treatment, and rehabilitation.

Mindray Medical's core business is the production and manufacturing of medical devices.

Financial reports show that Mindray Medical divides its business into three major categories: Life Information and Support, including monitors, ventilators, anesthesia machines, and defibrillators, which monitor and sustain patients' vital signs in real-time; In-Vitro Diagnostics, which analyzes samples like blood and bodily fluids to provide critical data for clinical decisions; and Medical Imaging, which includes ultrasound and X-ray equipment.

Before 2020, the medical device industry was a key sector supported by policies.

According to media statistics, since 2009, numerous supportive policies have been introduced for the medical device industry, such as the "New Healthcare Reform Policy" in 2009, the "12th Five-Year Plan" in 2011, and a series of policies supporting the procurement of domestic equipment from 2014 onward. Mindray Medical did not miss these opportunities. From 2016 to 2023, the company maintained double-digit growth in revenue and net profit, with the best performance in 2020, achieving growth rates of 27% and 42.24%, respectively. By 2024, Mindray Medical's revenue reached 36.73 billion yuan, with net profit at 11.67 billion yuan.

However, with the implementation of volume-based procurement in 2021, the decades-long industry boom began to wane. Despite having core competitiveness, Mindray Medical was also affected by price wars.

For example, in November 2024, the Xiamen Health Commission conducted a bidding process for 24 ultrasound machines across 12 hospitals in the city. In the first round, only four ultrasound machines were selected, all from Mindray Medical, with a total winning amount of 792,000 yuan, a 79.8% drop from the budgeted 3.93 million yuan. In January of this year, the Jiangxi Medical Insurance Bureau announced the results of the inter-provincial alliance's centralized procurement for biochemical reagents like glucose metabolism, with 1,544 specifications from 154 companies selected, averaging a 70% price reduction. Many foreign companies bid below 0.1 yuan, with Roche and Mindray products winning at 0.07 yuan per test.

Additionally, in a large-scale procurement of monitors by Shandong Provincial Hospital earlier this year, Mindray's ePM12C series won at just 10,000 yuan per unit, a drop of over 70% from the average winning price in 2024.

Overall, Mindray Medical's past success was undoubtedly driven by the era's 红利. Now, not only has the 红利 faded, but Mindray Medical has also begun its own 突围之路。

Breaking Through Overseas

Fierce competition in the domestic market has driven some leading companies to seek breakthroughs overseas.

Financial reports show that in the first half of this year, the gross margins of Mindray Medical's three main businesses declined. The gross margin for In-Vitro Diagnostics dropped from 64.98% in the first half of last year to 59.5% this year; Life Information and Support fell from 66.12% to 60.56%; and Medical Imaging decreased from 69.59% to 65.07%.

Due to the decline in gross margins across its three main businesses, Mindray Medical's overall gross margin dropped from 64.87% to 61.95% in the first three quarters of this year, while the net profit margin fell from 36.3% to 30.25%.

Beyond operational pressures, Mindray Medical's financial situation is also not optimistic.

In the past, mergers and acquisitions were a common strategy for global medical device giants to quickly enter new markets and acquire core technologies. Mindray Medical is no exception.

In 2008, Mindray acquired Datascope, the world's oldest monitoring brand, becoming the third-largest manufacturer in the global monitoring field. Subsequently, the company acquired several other leading domestic and international firms, including Shenke Medical, Suzhou Huisheng, Zonare, and Ulco. In recent years, Mindray Medical has embarked on more significant acquisitions: purchasing a 75% stake in German IVD company DiaSys for 115 million euros and acquiring control of Huite Medical, a STAR Market-listed company, for 6.65 billion yuan in self-raised funds. This acquisition was the first "A-share acquiring A-share" case on the STAR Market. Huite Medical specializes in the R&D, production, and sales of cardiac electrophysiology and interventional medical devices.

However, frequent acquisitions have also led to significant goodwill accumulation for Mindray Medical.

As of the end of Q3 2025, Mindray Medical's goodwill stood at 11.465 billion yuan, accounting for nearly 20% of total assets. At the end of 2020, this figure was only 1.225 billion yuan. The massive goodwill is like a sword hanging overhead—if the acquired assets underperform, it could lead to substantial impairment risks, directly impacting the company's net profit.

Of course, Mindray Medical is aware of the severity of the issue. With the domestic market unlikely to recover soon, the company has pinned its hopes on overseas markets. Records show that Mindray Medical has established production bases in 14 countries, with 11 already operational. After acquiring DiaSys in 2020, the company leveraged its Frankfurt facility to localize the production of biochemical and coagulation reagents. In the first half of 2025, European IVD revenue grew by 18% year-on-year, with localized DiaSys products contributing 40%. According to financial reports, Mindray Medical's international business showed significant growth in Q3, with the European market up 29%, including over 70% growth in the UK and Germany.

Indeed, compared to the domestic market, the international medical device market is far larger. Frost & Sullivan data shows that the global medical device market reached $623 billion in 2024 and is expected to grow to $869.7 billion by 2030. However, while the market is larger, competition is also fiercer, especially in high-end markets like Europe and the US, where Mindray Medical will compete directly with century-old giants like Medtronic, Siemens, Roche, and Abbott. These giants not only possess cutting-edge technology and deep brand moats but also control the rules of the game in high-end markets. For Mindray Medical, competing with them will be no easy task.

To accelerate its overseas expansion, in October this year, the company announced plans to list on the Hong Kong Stock Exchange's main board. Regarding the reasons for the Hong Kong listing, the company clearly stated that the raised funds will primarily be used to advance its international strategy and global business 布局. Clearly, Mindray Medical recognizes that going global is a tough battle, but for now, it has no way back.