Investment Rating - The report maintains a "Positive" outlook on the beauty and personal care industry, highlighting the resilience of domestic brands and the impact of new consumption trends [2]. Core Insights - The beauty and personal care sector experienced a robust recovery in H1 2025, with a retail sales growth of 2.9%, reversing the previous decline due to favorable consumption policies and improved income expectations [5][6]. - Domestic brands are gaining market share, with top local brands now competing closely with international counterparts, indicating a significant shift in consumer preferences [10][11]. - The report categorizes companies into three groups based on performance: those with strong brand matrices benefiting from multi-brand strategies, those capitalizing on consumer trends like domestic brands and collagen products, and those showing signs of strategic improvement [20][23]. Summary by Sections Industry Overview - The beauty market is projected to grow steadily, with a forecasted retail sales decline of 1.1% in 2024, followed by a recovery in H2 2025 [5][6]. - The domestic market share is expected to increase, with local brands achieving significant breakthroughs in both skincare and makeup segments [10][11]. Company Performance - **Cosmetics Sector**: - Major companies like Up Beauty and Proya reported revenue growth of 17.3% and 7.2% respectively in H1 2025, with net profits increasing by 30.6% and 13.8% [20][21]. - Other notable performers include Marubi and Water Sheep, with revenue growth of 30.8% and 9.0% respectively [21][22]. - **Personal Care Sector**: - Companies like Ruibin and Zhenjia showed remarkable growth, with Ruibin's revenue increasing by 67.6% and Zhenjia's by 157.11% in H1 2025 [5][20]. - **Medical Aesthetics Sector**: - Companies like Aimeike and Langzi reported mixed results, with Aimeike's revenue declining by 21.6% while Langzi's net profit surged by 64.1% [20][24]. Investment Recommendations - The report recommends investing in companies with strong brand matrices and low PE multiples, such as Up Beauty and Proya, as well as those benefiting from the Douyin traffic boost like Marubi and Water Sheep [20][24]. - It also suggests focusing on high-value segments and innovative products from brands like Ruibin and Furuida, and highlights opportunities in the maternal and infant sector with companies like Shengbeila and Haiziwang [20][24].

Group 1 - The overall performance of domestic beauty and skincare companies in the first half of 2025 remains stable, with Proya and Shiseido maintaining their positions as industry leaders, while Juzhibio leads in profit [1][2] - Proya's main brand shows a slight decline, indicating a near ceiling for single-brand growth in the domestic market, while Maogeping has entered the top five, representing the high-end trend in domestic beauty [2][10] - The financial performance of major companies shows varied results, with Proya reporting revenue of 5.362 billion yuan (up 7.21%), Shiseido at 4.108 billion yuan (up 17.30%), and Juzhibio at 3.113 billion yuan (up 22.50%) [3][4] Group 2 - Juzhibio's profit reached 1.182 billion yuan, a 20.60% increase, while Proya's profit was 799 million yuan (up 13.80%) and Maogeping's profit was 670 million yuan (up 36.10%) [5][6] - The beauty industry is facing challenges with brand positioning and organizational restructuring, particularly for established companies like Huaxi Biological and Beitaini, which have seen significant declines in performance [25][30] - Maogeping has successfully expanded into high-end skincare and fragrance markets, with a focus on diversifying its business to reduce reliance on single products [20][23] Group 3 - The emergence of new active ingredients, such as ergothioneine, is gaining attention in the beauty industry, with companies investing in research and development to innovate [39][42] - Marketing strategies are shifting towards brand strength and celebrity endorsements, with companies like Proya and Marubi actively engaging high-profile brand ambassadors [51][53] - Companies are increasingly focusing on building comprehensive sales channels that integrate online and offline strategies, as well as domestic and international markets, to adapt to changing consumer behaviors [58][60]

Investment Rating - The report initiates coverage with a "Buy" rating for the company Water Sheep Co., Ltd. [14] Core Insights - The cosmetics and medical beauty sector has underperformed the market, with the Shenwan Beauty Care Index declining by 2.5% from September 12 to September 19, 2025 [3][4] - The upcoming Double 11 shopping festival is expected to drive significant growth for domestic brands, with recommendations to focus on strong alpha stocks [9][10] - Water Sheep Co., Ltd. is highlighted for its dual business model of proprietary and CP brands, with stable revenue projections of 4-5 billion yuan from 2021 to 2024 and an expected gross margin of 63.01% in 2024 [10][11] Summary by Sections Industry Performance - The cosmetics and medical beauty sector has shown weaker performance compared to the market, with specific indices declining [3][4] - The Shenwan Cosmetics Index fell by 2.6%, while the Shenwan Personal Care Index decreased by 0.6% [4][6] Upcoming Events - The Double 11 shopping festival preparations are in full swing, with domestic brands like Up Beauty and Proya launching new products to capture market share [9] - Key influencers are negotiating promotional strategies to enhance sales during the festival [9] Company Focus: Water Sheep Co., Ltd. - Water Sheep Co., Ltd. is positioned as a leading tech-driven beauty company with a stable revenue forecast and improving profit margins [10][11] - The company has a well-structured brand matrix and is expanding its high-end product lines, with significant growth in its proprietary brands [11][12] - Expected net profits for Water Sheep Co., Ltd. are projected to be 258 million, 331 million, and 398 million yuan for 2025, 2026, and 2027, respectively, indicating substantial growth [14] Market Trends - The Chinese beauty market is witnessing a shift towards domestic brands, with significant market share gains for local players [27] - The overall retail sales of cosmetics showed a growth of 5.1% in August 2025, indicating a recovery in consumer spending [18][21] International Recognition - Chinese beauty brands performed notably at the IFSCC conference, showcasing their advancements in cosmetic science and securing significant awards [22][24]

2025年云南省政府工作报告明确提出，将发展特色优势产业作为主攻方向，构建符合省情实际的现代化产业体系。其中，以生物多样性赋能美妆产业"绿色基因"，打造"中国绿色美谷"成为地方 集团旗下拥有薇诺娜、瑷科缦、贝芙汀等多个知名品牌。其中，核心品牌薇诺娜连续八年（2017-2024）荣获"天猫金妆奖"，并连续五年稳居中国敏感肌护肤市场首位，成功入选工信部首批"中 研发投入行业领先，系统性构建科技壁垒 在研发方面，贝泰妮持续强化科技创新，构建起覆盖基础研究、原料开发、配方创新与临床评价的完整研发体系。2025年上半年，研发投入达1.19亿元，营收占比5%，处于行业领先水平。 公司已形成"产学研医"深度融合的创新机制。截至2024年末，累计完成63家医院皮肤学科临床研究合作，发表SCI及核心期刊论文493篇，立项国家标准样品4项，参与制定国家标准6项、团体 基于对云南特色植物资源的系统挖掘，贝泰妮在原料领域建立起显著优势。2025年上半年新增4项新原料备案，累计自主备案原料达16项，居行业前列。今年4月，云南特色植物提取实验室携自 多品牌+全渠道协同，国际化布局稳步推进 在品牌与业务布局方面，贝泰妮已形成层次清晰、覆盖 ...

Core Insights - Betaini Group has been recognized as one of the top 100 private enterprises in Yunnan Province for eight consecutive years, winning three awards in the manufacturing, innovation, and employment sectors, with innovation ranking first [1][2] - The company emphasizes strategic resilience and R&D to build long-term value, aligning with Yunnan's policy to develop characteristic advantageous industries and modern industrial systems [1][2] Group 1: Business Performance - From 2021 to the first half of 2025, Betaini achieved a cumulative revenue of 22.666 billion yuan and a profit of 3.421 billion yuan, with tax contributions around 2.7 billion yuan, indicating stable operational quality and growth [2] - The core brand, Winona, has won the "Tmall Golden Makeup Award" for eight consecutive years and has maintained its position as the leader in China's sensitive skin care market for five years [2] Group 2: R&D and Innovation - Betaini's R&D investment reached 119 million yuan in the first half of 2025, accounting for 5% of revenue, placing it at the forefront of the industry [3] - The company has established a comprehensive R&D system covering basic research, raw material development, formula innovation, and clinical evaluation, with 281 authorized patents and numerous collaborations with hospitals [3] Group 3: Brand and Market Strategy - Betaini has developed a clear brand matrix that meets diverse consumer needs, with the main brand Winona transitioning from focusing solely on sensitive skin to exploring advanced functions like whitening and anti-aging [4] - The company is expanding internationally, particularly in Southeast Asia, and has begun establishing brand recognition through social media platforms like Instagram and TikTok [4] - Betaini is committed to long-term strategies through technological innovation and sustainable operations, adapting to the transformation of the cosmetics industry from demographic dividends to value-driven growth [4]

Group 1 - The company, Betaini, has received three recognitions in the field of sustainable development, including being selected for the "Top 100 ESG Best Practices of Chinese Listed Companies 2025" and winning the "2025 China Listed Company Yinghua Award - A-share ESG Demonstration Case" [1][2] - Betaini is positioned as a skin health internet + big health industry group and ranks first in the sales of functional skincare products in China, demonstrating strong market leadership and commitment to corporate governance, environmental protection, and social responsibility [1][2] - The company has achieved a AAA ESG rating from Huazheng and has been recognized as an "Excellent ESG Practice Case" and "Best Practice in Investor Relations Management" by the China Association of Listed Companies [1][2] Group 2 - The three recognitions highlight Betaini's value as an industry benchmark in disclosure and practice, showcasing its evolution from a disclosure pioneer to a systematic model [2] - Betaini has published ESG reports for four consecutive years, aligning with international standards and transforming policy guidance into corporate actions, thus becoming a significant force in the sustainable transformation of Chinese enterprises [2] - The company's sustainable practices are integrated into its R&D, production, and branding, with initiatives such as a biodiversity protection project in Yunnan and innovative packaging that reduces plastic use by 39% [2][3] Group 3 - Betaini's ESG actions are driven by both scientific research and cultural values, with successful registration of 17 new cosmetic raw materials derived from Yunnan's biodiversity, contributing over 10 billion yuan to the industry chain in 2024 [3] - The "Weixiao Sunshine Program" has been protecting skin health in high UV regions for ten years, alongside projects focused on intangible cultural heritage and rural education, reflecting the company's deep-rooted value of giving back to society [3]

Core Viewpoint - The recent inspection results from the Yunnan Drug Administration have raised compliance concerns for Betaini and its subsidiaries, leading to a significant decline in the company's reputation and financial performance [2] Financial Performance - In the first half of the year, Betaini reported revenue of 2.372 billion yuan, a year-on-year decline of 15.43%, returning to levels seen two years ago [2] - The net profit attributable to the parent company fell by 49.01% to 247 million yuan, marking a five-year low [2] - The net profit margin decreased by 6.49 percentage points to 10.47% [2] Brand Performance - The main brand, Winona, contributed 82% of total revenue, amounting to 1.95 billion yuan, down 18% year-on-year [3] - Other brands like Jirui and Pome also saw revenue declines of 11% and 5%, respectively [3] Product Category Analysis - Skincare products generated approximately 2 billion yuan in revenue, with an average selling price dropping from 42.78 yuan to 39.01 yuan, leading to a 12% decline in revenue [5] - Makeup products also saw a decrease in average selling price from 38.67 yuan to 37.77 yuan, resulting in a 7.1% revenue decline [5] - Medical device products experienced a price drop to below 100 yuan, averaging 95.88 yuan, down from 106.61 yuan [5] Sales Channels - Online, OMO, and offline channels contributed 1.743 billion yuan, 191 million yuan, and 424 million yuan in revenue, with year-on-year changes of -5.89%, -10.48%, and -41.58%, respectively [5] Management and Marketing Strategy - Despite poor sales performance, sales expenses increased by 0.6% to 1.285 billion yuan, raising the sales expense ratio by 8 percentage points to 52.92% [8] - The company emphasized its commitment to a multi-channel network, integrating online and offline sales, but the effectiveness of this strategy remains to be seen [9] Market Reaction - Betaini's stock price has significantly declined from a peak of 289.35 yuan to a closing price of 47.46 yuan, resulting in a market capitalization reduction of nearly 100 billion yuan [10]

Market Overview - On September 17, the cosmetics sector declined by 0.24% compared to the previous trading day, with Qingsong Co. leading the decline [1] - The Shanghai Composite Index closed at 3876.34, up 0.37%, while the Shenzhen Component Index closed at 13215.46, up 1.16% [1] Individual Stock Performance - Notable stock performances in the cosmetics sector included: - Tian Cai Ya (603605) closed at 81.77, up 0.85% with a trading volume of 44,700 shares and a transaction value of 364 million [1] - Fu Rui Da (600223) remained unchanged at 7.91 with a trading volume of 70,100 shares [1] - Shanghai Jahwa (600315) closed at 27.37, down 0.04% with a trading volume of 44,200 shares [1] - Other stocks like Marubi (603983) and Beitaini (300957) also experienced slight declines of 0.05% and 0.88% respectively [1] Capital Flow Analysis - The cosmetics sector saw a net outflow of 105 million from institutional investors, while retail investors experienced a net inflow of 54.72 million [2] - The overall capital flow for individual stocks showed varied trends, with some stocks like Jia Heng Jia Hua (300955) experiencing significant net outflows from institutional investors [3] Detailed Capital Flow for Selected Stocks - Jia Heng Jia Hua (300955) had a net outflow of 13.34 million from institutional investors, while retail investors contributed a net inflow of 17.15 million [3] - Other stocks like Fu Rui Da (600223) and Shui Yang Co. (300740) also showed mixed capital flows, with institutional outflows and retail inflows [3]

Market Overview - On September 16, the cosmetics sector rose by 0.03% compared to the previous trading day, with Shuiyang Co., Ltd. leading the gains [1] - The Shanghai Composite Index closed at 3861.87, up 0.04%, while the Shenzhen Component Index closed at 13063.97, up 0.45% [1] Individual Stock Performance - Shuiyang Co., Ltd. (300740) closed at 22.48, with a gain of 1.63% and a trading volume of 208,500 shares, amounting to a transaction value of 469 million yuan [1] - Qingdao Kingway (002094) closed at 8.47, up 1.44%, with a trading volume of 326,600 shares and a transaction value of 277 million yuan [1] - Other notable performers include: - Kezhou Co., Ltd. (300856) at 14.23, up 0.57% [1] - Beitaini (300957) at 49.13, up 0.41% [1] - Furuida (600223) at 7.91, up 0.38% [1] Fund Flow Analysis - The cosmetics sector experienced a net outflow of 43.2 million yuan from institutional investors, while retail investors saw a net outflow of 23.0 million yuan [2] - Conversely, speculative funds recorded a net inflow of 66.2 million yuan [2] Detailed Fund Flow for Key Stocks - Shuiyang Co., Ltd. (300740) had a net inflow of 41.1 million yuan from institutional investors, while retail investors faced a net outflow of 71.8 million yuan [3] - Qingdao Kingway (002094) saw a net inflow of 15.3 million yuan from institutional investors, but a net outflow of 7.2 million yuan from retail investors [3] - Other stocks with significant fund flow include: - Beitaini (300957) with a net inflow of 5.7 million yuan from institutional investors and a net outflow of 13.2 million yuan from retail investors [3] - Furuida (600223) faced a net outflow of 10.2 million yuan from institutional investors but a net inflow of 8.9 million yuan from retail investors [3]

Market Overview - On September 15, the cosmetics sector declined by 0.18%, with Huaye Fragrance leading the drop [1] - The Shanghai Composite Index closed at 3860.5, down 0.26%, while the Shenzhen Component Index closed at 13005.77, up 0.63% [1] Individual Stock Performance - Notable gainers included: - Jinsong New Material (300849) with a closing price of 14.48, up 3.72% and a trading volume of 121,800 shares, totaling 179 million yuan [1] - Lafang Home (603630) closed at 28.58, up 2.11% with a trading volume of 71,300 shares, totaling 200 million yuan [1] - Notable decliners included: - Huaye Fragrance (300886) closed at 29.66, down 1.79% with a trading volume of 18,400 shares, totaling 55.05 million yuan [2] - Marubi Biological (603983) closed at 39.95, down 1.36% with a trading volume of 13,900 shares, totaling 55.49 million yuan [2] Capital Flow Analysis - The cosmetics sector experienced a net outflow of 83.38 million yuan from institutional investors, while retail investors saw a net inflow of 76.42 million yuan [2] - The overall capital flow for individual stocks showed: - Jinsong New Material had a net inflow of 18.50 million yuan from institutional investors, accounting for 10.31% of its total [3] - Huaye Fragrance had a net outflow of 4.23 million yuan from institutional investors, accounting for 6.58% of its total [3]