Goldman Sachs: Expects Ali Health (00241) 2026 fiscal year performance guidance to have upside potential, raises target price to 5.2 Hong Kong dollars.

Goldman Sachs released a research report stating that after ALI HEALTH (00241) announced its mid-term performance for the fiscal year ending in September 2026, they maintained a "Neutral" rating. The main reasons include the company benefiting from structural positive factors in the industry, such as the flow of original prescription drugs from hospital channels and the accelerated growth of online drug penetration rate. Goldman Sachs adjusted its revenue forecast for ALI HEALTH for the fiscal years 2026 to 2028 to an increase of 2% to 4%, and correspondingly raised the adjusted net profit forecast by 2% to 4%. Based on a forecasted 2027 price-to-earnings ratio of 28 times for its pharmacies and medical services business, the target price was raised from 4.7 Hong Kong dollars to 5.2 Hong Kong dollars, maintaining a "Neutral" rating. However, Goldman Sachs observed differences in revenue growth between the two major online pharmaceutical platforms, ALI HEALTH and JD HEALTH (06618), including the fact that first-party platform sales (1P) have become the main revenue and profit driving factors. Compared to its peers, ALI HEALTH still has gaps in establishing a complete first-party platform sales business model, especially in terms of user awareness and drug supply chain. Nevertheless, Goldman Sachs believes that ALI HEALTH still has room for upward performance guidance for the fiscal year ending in March next year, mainly due to the strong growth driven by its first-party platform sales business, especially in drug sales and strict cost control.