New Stock Preview | The leading domestic sports medicine company is heading to Hong Kong, is Tianxing Medical's IPO story a mixed bag of joy and sorrow?

Recently, Beijing Tianxing Medical Co., Ltd. (referred to as Tianxing Medical) submitted an application for listing on the main board of the Hong Kong Stock Exchange, with CITIC SEC and Indigo International as its joint sponsors. The listing journey of this domestic sports medicine leader has been full of twists and turns. The company initially attempted to list on the Shanghai Stock Exchange's Science and Technology Innovation Board in September 2023, aiming to raise 1.093 billion yuan, and entered the inquiry stage in October of the same year. However, in June 2025, the IPO on the Science and Technology Innovation Board was terminated due to CICC unilaterally applying to withdraw as sponsor. Subsequently, Tianxing Medical turned to the Hong Kong stock market and submitted its first Hong Kong listing application in August 2025. Now, after the failure of the prospectus, they are knocking on the door of the Hong Kong Stock Exchange for the second time. It is worth noting that before submitting the application to the Science and Technology Innovation Board, the company's valuation had skyrocketed fourfold in three years, with many shareholders rushing to invest. According to previous disclosures, the company's valuation was only 800 million yuan when it first increased capital in July 2020, but by January 2023, when institutions such as Yahui Jinlin and Jianxing Medical invested at 75.42 yuan per share capital, the valuation had soared to 3.5 billion yuan. Against the backdrop of the medical device industry facing challenges such as centralized procurement and medical insurance cost control, Tianxing Medical has delivered an impressive performance from 2022 to 2024, achieving high-speed growth in revenue and profits, with the gross margin also remaining high. However, behind this financial report, the company also faces multiple challenges such as a single product structure, the core products trading price for volume, and a focus on sales over research and development. Core products contribute nearly 80% of revenue Public information shows that Tianxing Medical is a medical device company focused on clinical solutions in sports medicine. Currently, the company provides comprehensive solutions for soft tissue injuries such as shoulder, knee, hip, foot/ankle, elbow, and hand/wrist joints, as well as sports rehabilitation and prevention. In the past few years, the company's financial data has shown outstanding performance. From 2022 to 2024, Tianxing Medical's revenue was 147 million yuan, 239 million yuan, and 327 million yuan respectively, with net profits doubling during the same period to 40.342 million yuan, 57.112 million yuan, and 95.389 million yuan. In the first three quarters of 2025, the company's revenue was 273 million yuan, a year-on-year increase of 23.5%. Although the revenue growth rate has slowed down, the profit continues to grow rapidly. During this period, the profit was 89.872 million yuan, an increase of 47.6% compared to the same period. Meanwhile, the company's gross margin has remained high. In 2022, 2023, and 2024, the company's gross margins were 70.9%, 74.3%, and 69.6% respectively. In the first three quarters of 2025, Tianxing Medical's gross margin was 73.8%, compared to 68.8% in the same period in 2024, an increase of 5 percentage points. The prospectus shows that the company's sports medicine product matrix mainly includes 62 products such as implants, active devices, related medical consumables and surgical tools, and regenerative repair products. Currently, the company's revenue is highly dependent on implant products, with implant revenue in the reporting period accounting for nearly 80% of the revenue each year. In contrast, revenue from surgical equipment and related consumables accounted for over 20%, while revenue from other products was negligible. However, behind the high growth of Tianxing Medical's core product, the implant business, is the cost of giving up on prices. Data shows that the average selling price of Tianxing Medical's implants has been decreasing year by year, from 735.8 yuan in 2022 to 446.3 yuan in 2024, a nearly 40% decrease in two years. In contrast, the sales volume of implants increased from 159,000 units in 2022 to 560,000 units in 2024, showing a clear trend of "trading price for volume." The company acknowledges that this is mainly due to some products being included in the volume-based procurement plan. It is understood that in 2024, the gross margin of this part of the company decreased from 79% in 2023 to 72.4%. Although it slightly rebounded to 76.6% in the first three quarters of 2025, the profit pressure brought by volume-based procurement is expected to continue. In addition, as a medical device company, Tianxing Medical's financial reports reveal a characteristic of being "sales-focused and research and development-light." From 2022 to the first nine months of 2025, the company's sales and distribution expenses were 39.792 million yuan, 66.108 million yuan, 69.628 million yuan, and 47.448 million yuan respectively, accounting for 27.1%, 27.7%, 21.3%, and 17.4% of operating income; during the same period, research and development expenses were 18.299 million yuan, 35.024 million yuan, 37.252 million yuan, and 32.671 million yuan respectively, accounting for 12.5%, 14.7%, 11.4%, and 12% of operating income. The absolute amount of research and development expenses was less than half of the sales expenses. Against the backdrop of increased policy support for research and innovation, it remains to be seen whether Tianxing Medical can maintain its long-term technological leadership position with its current level of research and development investment. Domestic alternative "leader" in a high prosperity track From the perspective of industry prospects, Tianxing Medical has indeed placed its bets on a highly potential track. In recent years, with the increasing awareness of national fitness and the rapid development of the sports industry, the sports medicine industry has been heating up. According to Zhoushi Consulting data, the market size of sports medicine implants and devices in China is expected to reach 121 billion yuan by 2030, with a compound annual growth rate of 14.3%. At the policy level, the winds of opportunity are blowing. The "Opinions on Further Releasing the Potential of Sports Consumption and Promoting the High-Quality Development of the Sports Industry" explicitly sets a target of a total sports industry scale exceeding 7 trillion yuan by 2030, with a series of supporting policies being implemented; in May 2025, the central bank included the sports industry in the 500 billion yuan consumer and elderly care loan support category. According to data from the National Bureau of Statistics, in 2025, in the retail sector, the retail sales of sports and entertainment goods by above-limit units increased by 15.7% year-on-year, far exceeding the average level of 3.7% for total social consumer goods retail sales; data from the General Administration of Sport shows that in 2025, the proportion of people who regularly participate in sports activities nationwide reached 38.5%, and the average per capita sports consumption of residents aged 19 to 59 reached nearly 2500 yuan, a 38% increase from 2020, providing a broad space for industry development. It is understood that in this niche track, Tianxing Medical is at the forefront of domestic alternatives. Based on sales revenue in 2024, the company ranks fourth in the Chinese sports medicine implants and devices market with a 6.5% market share, and is the only domestic enterprise among the top five, breaking the long-term monopoly by international giants such as Stryker and Johnson & Johnson. The trend of domestic acceleration is also evident in the sixth batch of high-value consumables in the national centralized procurement in January 2026. Data shows that this national procurement presents the characteristics of "moderate price reduction, scientific rules, and benefit for domestic brands." Chinese products account for over 91% of the selected products, with foreign brands retaining a small share in a few high-end models. Looking ahead, as the trend of normalization, systematization, and refinement of centralized procurement continues, Tianxing Medical, as a leading domestic player in the niche market, is expected to continuously increase its market share. However, opportunities and challenges always go hand in hand. Nearly 80% of Tianxing Medical's revenue is concentrated in implants, which are the focus of centralized procurement. While the procurement rules are becoming more scientific, the long-term pressure on the company's main product prices is inevitable. If the scope of future centralized procurement expands or the price reductions exceed expectations, the overly single revenue structure could pose significant fluctuations in the company's performance. Looking at the IPO fundraising usage this time, Tianxing Medical is currently focusing on expanding production capacity. From 2022 to the first nine months of 2025, the company's implant production facility utilization rates were 89.2%, 105.6%, 102.4%, and 92.2% respectively, with a utilization rate exceeding 100% for two consecutive years, highlighting the imminent production capacity bottleneck. With sales volume continuing to grow rapidly, expanding production is a top priority. Moreover, the overseas market has become a new growth point for the company. During the reporting period, the company's overseas revenue increased from less than 380,000 yuan in 2022 to 20.85 million yuan in 2024, achieving a 204% year-on-year growth in the first three quarters of 2025. As of the date of the last feasible activity, the company has obtained more than 200 medical device regulatory approvals and registration certificates in Europe, Southeast Asia, the Middle East, and Latin America, indicating the emergence of a second growth curve. Overall, Tianxing Medical is in a high prosperity track, and its leading position as a domestic sports medicine equipment leader is beyond doubt. However, at the same time, with nearly 80% of revenue depending on a single product, the core business facing pressure from centralized procurement, and relatively insufficient research and development investment, the company may still face bottlenecks in its long-term development, even if it successfully lists.