JD will continue to increase subsidies of 10 billion dollars this year. By the end of April, it will launch an additional bonus function on the consumer settlement page, testing the waters in the beauty category first.
Zhitong Finance App learned that Unilever (UL.US)'s revenue growth in the first quarter exceeded expectations, driven by CEO Hein Schumacher's transformation plan.
CITIC Securities's May 17 research report pointed out that advances in biotechnology are driving the low-cost, high-quality supply of raw materials, compounding the advantages of local brands in consumer insight, content marketing, and traffic management. The trend of localization of beauty is clear, and the share of local brands is expected to continue to rise. CITIC Securities suggests focusing on:
1) Cost-effective main line;
2) Companies that support biotechnology and dermatology, and advance skin care and medicine together;
3) Upstream raw material enterprises that promote each other with domestic and foreign brands, based on synthetic biology, fine chemicals and other technologies and processes.
According to the Minsheng Securities Research Report, it is recommended to focus on allocation opportunities in the beauty sector. As leading domestic beauty companies continue to explore and recombine new ingredients such as collagen and cyclic peptides on the product side, improve the layout of emerging channels such as Douyin on the channel side, and shape a “technology-driven” brand image to enhance brand power, the long-term competitive advantage of domestic beauty leaders is expected to be further consolidated.
Companies related to the beauty sector:
Shangmei Co., Ltd. (02145): The company achieved operating income of 4.191 billion yuan last year, an increase of 56.6% over the previous year; realized net profit of 461 million yuan to mother, an increase of 213.5% over the previous year. CITIC Construction Investment pointed out that in the medium to long term, the company will implement the “2+2+2 strategy” and “six six strategy”, focus on the six major superbrands, and comprehensively lay out the three major tracks of skin care, mother and baby care, which is expected to open up new growth space. According to the data, in the first quarter of this year, Han Shu's total GMV on the three major e-commerce platforms (Douyin, Tmall, and Taobao) reached 2.3 billion, ranking first in domestic beauty.
Giant Biotech (02367): The company is the first company in the world to mass-produce recombinant collagen skincare products, and the first company in China to obtain a medical device registration certificate for recombinant collagen products. In the field of rare ginsenosides, the company is the first company in China to achieve mass production of five high-purity rare ginsenosides (i.e. Rk3, Rh4, Rk1, Rg5, and CK) on a scale of 100 kg. The company uses professional medical+mass consumption, offline+online omnichannel layout and operation models to establish a brand image of professional skin care among consumers. In 2023, the company achieved rapid growth in all major e-commerce channels. The online omni-channel GMV growth rates of Kefumi and Colijin exceeded 165% and 70% respectively during the 618 period, and over 100% and 50% respectively during the Double Eleven period.
Haohai Biotechnology (06826): The three hyaluronic acid products that the company has launched have differentiated positioning and complementary development in terms of price, characteristics and efficacy. Among them, Haiwei is positioned as an entry-level HA filler popularizing the public, as a drainage product for medical and aesthetic institutions; Jiaolan added lip indications, bringing new room for growth; Haimei focuses on particle-free linear cross-linking technology and has a broad market space; and Bioxis' Cytosial series products are being registered and listed in China. The company's hyaluronic acid product portfolio is expected to seize more market space with technical advantages, cost performance advantages and meeting refined needs. In terms of ophthalmology business, the company's artificial tear product “sodium hyaluronate eye drops” was approved in March 2024, further enriching the application scenarios of the company's product portfolio, and is expected to expand the synergy effect of the company's marketing in the future.
Mao Geping (upcoming listing): According to the Hong Kong Stock Exchange disclosure on April 8, Mao Geping Cosmetics Co., Ltd. (Mao Geping) submitted a listing application to the main board of the Hong Kong Stock Exchange, and CICC is its sole sponsor.