[Top 100 Perspective] Mid-term profit forecast increased by over 150%! Is the window for Yonghe Medical's profitability recovery opening?
On July 29, Yonghe Medical (02279.HK), the leading chain hair transplant company, saw its stock price surge rapidly. As of press time, it had risen by 6.82%, trading at HKD 2.35 per share.
The core news driving this market movement came from Yonghe Medical's pre-market positive earnings forecast for the first half of 2026—net profit improved significantly year-on-year, signaling a recovery in profitability.
According to the announcement, Yonghe Medical expects to achieve a net profit of no less than RMB 70 million (in RMB, same below) in the first half of 2026, representing a year-on-year growth of no less than 150.9%. During this period, the company's revenue is also expected to grow steadily by no less than 10.0% compared to the same period in 2025.
As a top player in China's hair transplant medical services sector, Yonghe Medical's business covers hair transplant surgeries, scalp care treatments, and anti-hair loss hair care products. It has built a comprehensive hair loss service system ranging from diagnosis and treatment, surgery, to long-term maintenance, with an offline clinic network 布局 across major cities nationwide.
Regarding the continuous improvement in profitability, Yonghe Medical attributes this to the following factors:
First, steady growth in core business revenue, with continuous optimization of the business structure. During the period, the company continued to promote the synergistic development of its hair transplant business and medical maintenance business, maintaining steady growth in core business revenue. The former is expected to see year-on-year revenue growth of no less than 10.0%, while the latter achieved a growth rate of no less than 15.0%.
Second, continuous improvement in operational efficiency, with scale effects releasing to drive significant improvements in profitability. Building on the profitable turnaround achieved in 2025, the company continued to optimize its business model, enhance operational efficiency, improve input-output efficiency, and implement refined management. Operating quality has continuously improved, and operating leverage effects are gradually being released, further enhancing profitability. It is estimated that during the period, the company's gross margin will increase by no less than 5.0 percentage points compared to the same period last year.
It should be noted that this profit improvement relies more on cost reduction and efficiency gains, representing 阶段性 cost control results, and has not truly solved deeper issues such as insufficient growth momentum in main businesses. Long-term operational stability still needs observation.
Multiple pressures at the industry level have also not been resolved: First, the number of participants in the hair transplant track continues to increase, with regional institutions and comprehensive medical beauty brands entering the market, leading to low-price competition that diverts customers and suppresses the upward space for average transaction value; second, hair transplants are non-essential discretionary consumption with high demand elasticity, so fluctuations in residents' willingness to spend directly affect store foot traffic; third, customer acquisition costs in the industry remain high, with marketing expenses accounting for a large proportion of costs for a long time, posing a continuous test to enterprises' refined operational capabilities.
Overall, Yonghe Medical's positive earnings update for the first half confirms the moderate recovery in industry demand and the 阶段性 effectiveness of the company's cost reduction and efficiency measures, bringing a boost to sentiment. However, uncertainties in the industry competitive landscape and consumer recovery still exist, requiring a rational perspective.
Another noteworthy point is that the preparatory work for the 13th "Hong Kong Stock Market Top 100" selection is progressing steadily. The list selects high-quality Hong Kong stocks from multiple dimensions including profitability, growth potential, industry barriers, and market performance, covering tracks such as medical services, biopharmaceuticals, and consumer sectors. Many consumer healthcare companies were shortlisted in the previous edition.
For Yonghe Medical, the window for profit repair has opened. If it aims to secure a better ranking in this edition's list, sustained growth in customer traffic and steady improvement in profitability in the second half of the year will be key indicators to watch.
Source: Caifuhua Network
$YONGHE MEDICAL(02279.HK)
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