As "AI + healthcare" becomes one of the most imaginative sectors in the capital markets, a leading precision diagnostics company with this core has officially knocked on the door of the Hong Kong Stock Exchange. On December 21, Genetron Health (referred to as Genetron) submitted its listing application to the main board of the Hong Kong Stock Exchange, aiming to tell investors a growth story centered on "data moats, full-chain platforms, and AI-driven innovation," leveraging its third-place ranking in China's precision diagnostics market.

**Revenue Stabilizes After Volatility, Adjusted Losses Narrow Significantly** According to the prospectus, Genetron is a rare "AI + multi-omics" full-chain platform company in China's precision medicine sector. Its core investment thesis lies in its proprietary integrated technology framework, which combines high-throughput sequencing (N-omics), bioinformatics, and artificial intelligence to achieve a closed loop from biomarker discovery and validation to product development and commercialization. This sets it apart from competitors focused solely on diagnostic services, reagent sales, or single-stage analysis.

The company's competitive moat is reflected in three areas: 1. **Data Advantage**: It operates one of the industry's earliest large-scale multi-omics baseline databases, providing indispensable fuel for AI model training and iteration. 2. **Integrated Technology**: Its "omics factory - bioinformatics cloud - large models and intelligent agents" architecture enables end-to-end AI coverage of workflows, improving R&D efficiency and the originality of biomarker discovery. 3. **Full-Chain Validation**: Its MRD (minimal residual disease) detection product has entered the National Medical Products Administration's (NMPA) special review program for innovative medical devices, positioning it to become China's first commercialized MRD kit—a milestone that validates its "discovery-validation-approval" platform capabilities.

Genetron's business revolves around the precision medicine value chain, with three synergistic segments: - **Precision Diagnostics (Current Revenue Pillar)**: Ranked third in the 2024 market, offering products and services such as tumor MRD and companion diagnostics. Its HDT (hospital-direct-to-patient) model embeds directly into top hospitals' clinical pathways, ensuring high customer stickiness. - **Drug Development Enablement (Growth Engine)**: Provides pharmaceutical companies with end-to-end services from early target discovery and biomarker development to companion diagnostics commercialization. This segment benefits from China's biopharma R&D boom, featuring high margins and long-term partnerships. - **Clinical Research & Translation (Capability Incubator & Data Source)**: Collaborates with leading hospitals and research institutions, serving as a testing ground for cutting-edge technologies and a channel for acquiring high-quality clinical data to enhance platform capabilities.

As of the latest data, Genetron has penetrated over 1,000 hospitals (including 30% of China's top 100 hospitals) and partnered with more than 200 pharmaceutical companies, demonstrating its technology's recognition by high-end clients and its potential for benchmark effects and channel reuse.

**Financial Performance: Revenue Stabilizes, Losses Narrow** From 2022 to the first half of 2025, Genetron's revenues were RMB 1.815 billion, RMB 473 million, RMB 557 million, and RMB 285 million, respectively. Net profits were RMB 372 million, RMB 54 million, -RMB 424 million, and -RMB 414 million, while adjusted net profits were RMB 105 million, -RMB 300 million, -RMB 88 million, and -RMB 48 million.

Key takeaways: - **Revenue**: After a 74% YoY plunge in 2023, revenue rebounded by 17.6% in 2024. The H1 2025 figure of RMB 285 million, if annualized (~RMB 570 million), slightly exceeds full-year 2024, indicating sustained but modest growth. - **Profitability**: Core operating losses (adjusted net profit) narrowed significantly from -RMB 300 million in 2023 to -RMB 88 million in 2024 and -RMB 48 million in H1 2025 (annualized ~-RMB 96 million), signaling rapid progress toward breakeven despite ongoing investment phases.

**Liquidity Pressure and IPO Imperative** The current ratio deteriorated from 0.5 to 0.2, highlighting acute short-term solvency pressure. As of June 30, 2025, current liabilities totaled RMB 22.98 billion against RMB 5.23 billion in current assets. However, RMB 18.91 billion of liabilities relate to "preferred shares" and similar equity-like instruments, which are expected to convert to ordinary shares upon listing. Excluding these, interest-bearing debt (primarily bank loans) stood at RMB 140 million, with cash and equivalents at RMB 96 million—a tight liquidity position underscoring the IPO's urgency to optimize capital structure.

**Growth Potential and Commercialization Hurdles** Genetron's long-term growth hinges on two high-growth sectors: MRD monitoring and MCED (multi-cancer early detection), powered by its "AI + multi-omics" platform. - **MRD**: The Chinese market is projected to reach RMB 92 billion by 2025. Its flagship product, "Ji Chang'an," is under NMPA's special review and could become China's first commercial MRD kit. - **MCED**: Its GM-seq methylation technology boasts world-leading sensitivity (82.4%) and specificity (99%) for early-stage cancers, with large-scale clinical studies underway for IVD conversion.

The company is expanding into cardiovascular, neurodegenerative, and organ health monitoring (e.g., kidney transplant injury detection), showcasing platform extensibility but also posing R&D, validation, and market education challenges.

**Industry Dynamics** Regulatory tightening may favor established players like Genetron, but the shift toward holistic health management demands continuous service闭环 capabilities and cross-sector integration—testing operational and financial resilience. While AI in healthcare data and drug discovery offers growth potential, its clinical and commercial viability remains unproven.

**Conclusion** Genetron operates in a promising yet demanding landscape. Its success depends on product commercialization, cross-sector execution, and competitive dynamics. Investors should monitor core product approvals, revenue traction, cash flow health, and new business ROI closely.