Upcoming IPO OutlookTangji Medical: What is the advantage of being the first mover in the 111% growth lane for endoscopic weight loss, which is a "China first"?

Recently, the news that Hangzhou Tangji Medical Technology Co., Ltd. (hereinafter referred to as: Tangji Medical) submitted its main board listing application to the Hong Kong Stock Exchange has attracted the attention of the capital market. As the global weight loss market seeks better solutions amidst the debate between GLP-1 weight loss drugs and traditional surgical gastric bypass, Tangji Medical presents the worlds first commercialized gastric bypass stent system (GBS), demonstrating that the minimally invasive and reversible third path is a validated commercial reality, with clinical coverage across 490 hospitals, over 5,200 surgeries, and a gross profit margin exceeding 84%. Breaking the Ground: China's Original Innovation in Endoscopic Weight Loss Metabolism Publicly available information shows that Tangji Medical was founded in 2016, focusing on the research and commercialization of intestinal interventional medical devices in the field of obesity and metabolic diseases. As of the last practical date, the company has established a clearly defined product matrix: on one hand, its core product, the gastric bypass stent system (GBS), has achieved commercialization; this product is suited for obesity with a duodenum-jejunum bypass sleeve (DJBL) under gastrointestinal endoscopy. The company is actively promoting the expansion of GBS indications to lower BMI populations to increase the potential patient coverage. On the other hand, two other products have been launched and a digital health management platform has been approved, forming an auxiliary product ecosystem around the treatment of metabolic diseases; additionally, there are 13 pipeline products under various stages of clinical development, covering indications like metabolic-associated fatty liver disease and type 2 diabetes, which provide potential valuation anchor points for the companys medium- to long-term growth. After years of research and development, GBS was approved for market launch by the National Medical Products Administration in January 2024 and navigated the green channel for Innovative Medical Management devices, becoming the first three-class Innovative Medical Management device approved in China for gastrointestinal endoscopic treatment of obesity. GBS is not only the first in China but also the first commercially approved intestinal interventional stent for obesity globally. The advantage of the product needs to align with sufficient market space to truly commercial value. From a market perspective, Tangji Medical has positioned itself in a rapidly expanding incremental market. According to Frost & Sullivan data, the global market size for endoscopic weight loss metabolism (EBMT) devices is expected to grow from $14.8 million in 2025 to $124.8 million by 2030, with a compound annual growth rate (CAGR) of 53.1%; the EBMT device market in China is projected to increase from 32 million yuan in 2025 to 1.352 billion yuan by 2030, with a staggering CAGR of 111.1%. Supporting this rapid growth is the substantial patient base of 233.7 million obese individuals in China by 2025, expected to rise to 329.8 million by 2034this dual resonance of market expansion and demand release constitutes the underlying fundamentals of Tangji Medical's breakthrough. While the market space is vast, the competitive landscape is also worth examining. Currently, China's EBMT market exhibits a pattern of one strong, many researchers, and international observersTangji Medical is the only enterprise in this niche market possessing a commercialized three-class device, putting it in an absolute leading position. This means the company will continue to enjoy the "unpopulated area dividends" of this niche market over the next 2 to 3 years, possessing pricing power and a first-mover advantage in market access. It is noteworthy that the company is actively promoting the GBS-Low BMI project, expanding its indications from BMI 30 kg/m to include populations with BMI 25 kg/m with comorbidities. If approved, the patient population will extend from the current obese populace to overweight individuals with metabolic abnormalities, leading to a magnitude expansion of the market size. Meanwhile, GBS has been approved in 11 countries and regions including Hong Kong, Indonesia, Thailand, Saudi Arabia, and Brazil, with EU CE certification also being actively pursued. This dual-driven strategy of deepening domestic market expansion + diversifying overseas market presence opens up multidimensional growth opportunities for GBS. Accelerating Commercialization: The Growth Logic Behind 5,200 Surgeries From the approval for market launch to commercial volume, the market introduction rhythm of GBS shows a typical penetration curve for Innovative Medical Management devicesinitially, there is a prolonged accumulation phase for hospital access, but once the critical point is crossed, the number of surgeries exhibits a non-linear leap. In 2024, the number of GBS procedures was 239, which skyrocketed to 2,066 in 2025, reflecting an increase of over 8 times year-on-year; in the first half of 2026, it reached 1,955 cases, a year-on-year growth rate of 139.3%. As of the last practical date, there have been over 5,200 cases cumulatively, covering 490 hospitals nationwide. The commercialization network has shifted from an "expansive layout" phase to an "in-depth cultivation" phasefuture growth engines will increasingly stem from enhancing output per single hospital rather than expanding the number of hospitals, thus requiring higher levels of academic promotion capabilities and ongoing education for medical professionals. In line with this, the company has completed operational training for over 650 doctors, laying a talent foundation for the sustained growth of single-hospital surgical volumes. The leap in surgical volume directly translates to a growth in revenue scale. Revenue for the full year of 2024 is projected at 12.709 million yuan, rising to 32.21 million yuan in 2025, representing a year-on-year increase of 153.5%; during the first half of 2026, revenue is expected to reach 23.69 million yuan, marking a year-on-year growth of 91.4%. From a channel structure perspective, distribution accounted for a staggering 99.7% in the first half of 2026, highlighting a dominant distribution characteristic. The efficiency of the channel structure ultimately reflects the company's profitability. In the first half of 2026, the overall gross profit margin was 84.9%, with the gross profit margin for GBS alone reaching 85%. This high gross profit level is built on three key pillars: the globally innovative differentiated clinical value, the blue ocean market devoid of similar competing products, and the entry barriers brought about by the green channel for Innovative Medical Management devices. In summary, the commercialization curve of GBS validates both the market demand for the product and its clinical acceptance, with the high gross profit margin and rapid growth constituting the fundamental support for short-term valuation. However, the true test of commercialization efficiency hinges on the continued enhancement of output per single hospital, the downward trend of cost ratios, and whether a second growth curve can emerge from the 13 pipelinesnone of these can be missing, as they collectively form the core logic for the companys transition from a single product as the mainstay to a sustainable profit platform. Deepening the Pipeline: From a Single Product to a Metabolic Disease Treatment Platform According to the prospectus, Tangji Medical is leveraging the GBS technology platform to accelerate its transformation into a platform enterprise through the construction of 13 research and development pipelines. In terms of expanding indications, the company is advancing in three major directions: GBS-Low BMI will extend indications to include overweight individuals with metabolic abnormalities, with key clinical trials expected to complete by the end of 2027, likely resulting in a significant market size expansion; GBS-SH targets metabolic-associated fatty liver disease (MASH) and has received breakthrough device designation from the FDA, with plans to initiate international multicenter registration trials before the end of 2027, promising to open up a blue ocean market; GBS-DM is for obesity with concomitant type 2 diabetes, with initial human clinical trials expected to be completed in the second half of 2027. Beyond the GBS platform, the company is also developing a biodegradable intra-gastric balloon (DIGB) that is automatically expelled after 3-4 months, eliminating the need for endoscopic removal and complementing GBS to broaden the coverage of the endoscopic weight loss market, with key clinical trials expected to be completed by 2027 and the CE marking application in Europe having been submitted in February 2026. Additionally, the company is simultaneously constructing auxiliary devices and a digital platform, with electronic gastroscopes, endoscopic recovery kits, and Chinas first digital health platform for obesity management (Dtx) having been approved, aiming to create a full-cycle management ecosystem of devices + digital health + clinical nutrition. In terms of global expansion, GBS has been approved in 12 countries and regions including China, Indonesia, Saudi Arabia, and Brazil, with EU CE certification expected to be completed in the second half of 2026. In conclusion, Tangji Medicals core product GBS has demonstrated its clinical acceptance and commercial monetization capability with over 5,200 surgeries and a gross profit margin of 84.9%; while the 13 pipelines outline a long-term narrative of transitioning from a single product to a metabolic disease treatment platform." Whether Tangji Medical can complete the transition from first-mover advantage to systemic barriers before competitors enter will be a key gauge for the capital market in determining its final valuation.