According to CITIC Securities, short-term factors such as policy easing, centralized procurement clearance, new product and business expansion, and overseas market strategies are expected to drive a performance turning point for leading medical device companies in 2026. Investors are advised to capitalize on valuation recovery opportunities as well as emerging trends like brain-computer interfaces and AI-driven healthcare.

The long-term investment potential in the medical device sector stems from innovation, global expansion, and mergers & acquisitions. The sector's innovation capabilities and international competitiveness are gaining recognition, leading to a reassessment of valuations.

Key insights from CITIC Securities include:

- **Medical Equipment & Upstream**: This year’s tender activity has significantly improved. The 2026 tender outlook depends on policy adjustments, with leading companies likely to achieve stable or accelerated revenue growth. Upstream firms may see accelerated growth driven by new business, orders, and clients.

- **High-Value Consumables**: Due to varying timelines for centralized procurement policies, performance turning points will differ among companies. By 2026, sectors and firms with cleared procurement impacts or new product catalysts may experience operational improvements. Policy optimizations could also drive valuation and earnings recovery.

- **IVD (In Vitro Diagnostics)**: While 2026 performance remains policy-sensitive, conditions are expected to improve compared to 2025. The elimination of VAT-related impacts, stabilized testing volumes, and continued import substitution by domestic manufacturers will support growth. Companies with strong overseas operations will demonstrate higher earnings certainty.

- **Low-Value Consumables**: Domestic demand is projected to grow steadily in 2026, while overseas capacity expansions and easing U.S.-China tariffs may contribute to incremental earnings.

- **Home Medical Devices**: The sector is expected to maintain stable growth, with leading domestic players accelerating internationalization through in-house expansions and M&A.

**Risks**: Stricter-than-expected procurement policies, intensified competition, delayed regulatory approvals, and unpredictable external factors may pose challenges.