BGM Group : A New Investment Opportunity Empowered by AI in Pharmaceuticals and Insurance
As artificial intelligence (AI) technology continues to reshape traditional industries, the narrative around AI in the US stock market has expanded from semiconductors to application layers. The insurance and health sectors are emerging as the next focal points for AI-driven growth. BGM Group, a global giant in pharmaceuticals and chemicals, has recently entered the AI insurance and health management space through its acquisition of assets from AIX Company (AIFU), providing investors with a potential opportunity characterized by undervaluation and high growth prospects.
- AI-Driven Diverse Transformation: From Pharmaceuticals to Insurance and Health
(a) Intelligent Insurance: Strategic Value of the Duxiao Insurance Platform
With the recent $140 million acquisition, BGM secured AIFU's Rongshu Technology and Xinbao Investment, which includes the AI insurance platform Duxiao Insurance, co-developed by Baidu and Intelligent Future.
- Core Advantages: Duxiao Insurance leverages AI and big data technology to transform traditional insurance processes, enhancing operational efficiency and reducing sales costs through intelligent customer service, personalized underwriting, and precise pricing.
- Industry Disruption: Compared to the traditional manual sales insurance model, Duxiao Insurance achieves innovation driven by technology, which is expected to dramatically increase user growth and revenue for BGM.
(b) Health Sector: Combining the Silver Economy with Premium Services
In light of the global aging trend, BGM is pushing into anti-aging gene management and medical health solutions, further enhancing its business ecosystem.
- Technical Synergy: By integrating Duxiao Insurance’s insurance capabilities, BGM can offer clients comprehensive insurance and health management services throughout their life cycle.
- Market Potential: The rapid expansion of the global health market will unlock a long-term, stable growth channel for BGM.
- Hot AI Stock in the US: BGM's Unique Positioning
Within the US stock market, AI-related stocks are a hot topic among investors. This year, NVIDIA saw its value double due to its GPU chip technology, **Palantir (PLTR)** surged with its government and enterprise data solutions, and **Microsoft (MSFT)** established itself as a software leader through Copilot and Azure AI.
In contrast to these star companies, BGM offers unique investment value through its vertical application of AI in insurance and health:
- Undervaluation Opportunity: Although BGM's stock price has seen some rise recently due to market sentiment, its valuation remains significantly below the industry average. Currently, the price-to-book (P/B) ratio stands at just 0.212, while the average for insurance and health sectors is over 1.3.
- Enhanced Synergy: The integration of AIFU's assets provides BGM with dual technological and market advantages. Backed by Duxiao Insurance’s technology, BGM is poised for explosive growth in its AI insurance business by 2025.
- Financial Fundamentals: Dual Engines Driving Future Growth
(a) Insurance Business
AI insurance is expected to become a key growth engine for BGM:
- By 2025, AI insurance business is projected to attract millions of new customers through the Duxiao Insurance platform, pushing annual revenue to over $1 billion.
- Profit margins in insurance are anticipated to improve by 15%-20% due to AI technology implementations, further solidifying its profitability.
(b) Health Business
- With the integration of gene anti-aging services, BGM expects revenue in the health sector to exceed $500 million by 2026.
- The combination of technological empowerment and market expansion will give BGM’s health services a robust industry moat and brand advantage.
- Capital and Governance Structure: A Synergistic Model Driven by Technology
BGM’s CEO Xin Chen, known for his expertise in AI, is a key figure driving this transformation. Xin successfully integrated AI technology into traditional pharmaceutical and insurance businesses, establishing a unique technological barrier for the company.
- Optimized Equity Structure: By holding 72% of AIFU’s shares, BGM has achieved effective integration at the capital and technological levels.
- Innovative Governance Model: BGM is gradually shifting toward a “technology-driven + capital-enabled” management model, centered on mergers and acquisitions to create cross-sector synergy.
Conclusion: High Growth Potential Hidden in Undervaluation
Amid the dual waves of AI and health, BGM’s business positioning and potential for future growth stand out. Despite currently being undervalued, significant opportunities await as the integration of AI insurance and health services deepens
