Group 1 - The cosmetics sector experienced a slight increase of 0.22% on September 10, with Jinsheng New Materials leading the gains [1] - The Shanghai Composite Index closed at 3812.22, up 0.13%, while the Shenzhen Component Index closed at 12557.68, up 0.38% [1] - Jinsheng New Materials saw a significant rise in its closing price to 14.38, reflecting an increase of 11.73% with a trading volume of 139,700 shares and a transaction value of 198 million yuan [1] Group 2 - The cosmetics sector faced a net outflow of 10.99 million yuan from institutional investors and 78.76 million yuan from retail investors, while individual investors saw a net inflow of 89.75 million yuan [2] - The trading data indicates that Jinsheng New Materials had a net inflow of 24.75 million yuan from institutional investors, despite a net outflow from retail and speculative investors [3] - Qingdao Kingway and Beitaini also reported net inflows from retail investors, while other companies like Shanghai Jahwa and Marubi experienced net outflows from both institutional and speculative investors [3]

Core Viewpoint - The company, Betaini (300957), is focused on researching Yunnan's unique plant resources and integrating modern technology with traditional wisdom, having successfully approved 16 new cosmetic raw material filings [1] Group 1: Company Initiatives - The company is committed to building a skin health research and development system with Chinese characteristics [1] - Betaini actively contributes to industry progress by participating in the formulation of standards such as the "Guidelines for the Establishment of a Research and Development System for Plant Resource Cosmetics with Chinese Characteristics" [1] Group 2: Market Positioning - The company emphasizes continuous innovation to enhance the influence of Chinese brands in the global cosmetics market [1] - Betaini aims to provide consumers with more efficient and safer skincare solutions [1]

Group 1 - The core viewpoint of the article highlights that Betaini (300957) has maintained a leading position in the domestic dermatological skincare market with its "Winona" brand, achieving a market share of approximately 20.70% in 2024, which shows an increase compared to the previous year [1] - The company has focused on technological innovation in the efficacy skincare sector, establishing a core barrier through research and development [1] - In the first half of 2025, the company's R&D expense ratio reached 4.91%, with four new raw material registrations and a total of six IFSCC international academic papers submitted [1] Group 2 - The company aims to build trust for Chinese brands in the global market through solid scientific research and clinical validation [1]

Core Viewpoint - The company is addressing concerns regarding high sales expenses, particularly the reliance on third-party platforms for sales, and emphasizes its commitment to a multi-channel sales strategy that includes both online and offline channels [2]. Group 1: Sales Expenses - The company's sales expenses, particularly "channel and advertising expenses," account for over 70% of total sales expenses, which represent approximately 50% of revenue [2]. - The company is focused on improving operational quality and controlling expense inputs to enhance profit levels in the future [2]. Group 2: Sales Strategy - The company maintains a foundational offline channel while leading with online channels through a deep private domain operation model, successfully integrating online and offline sales [2]. - The company has established a diverse channel network that includes self-operated e-commerce, offline counters, and pharmacies, and is continuously optimizing its channel structure to reduce dependency on a single platform [2].

Core Viewpoint - The article discusses the challenges faced by Betaini, a Chinese beauty company led by Guo Zhenyu, highlighting its declining market performance and the need for strategic transformation to regain growth momentum [2][6][11]. Company Background - Guo Zhenyu, a former academic, became the owner of Betaini, which primarily sells the "Winona" product line, catering to consumers with sensitive skin [2][4]. - Betaini was listed on the Growth Enterprise Market four years ago, reaching a peak market value of 120 billion RMB, but has since struggled, with a current market value of 21.54 billion RMB as of September 2025 [2][6]. Financial Performance - Betaini's revenue growth has significantly slowed, with 2023 revenue at 55.22 billion RMB (10.1% YoY growth) and 2024 at 57.36 billion RMB (3.9% YoY growth), while the first half of 2025 shows a decline to 23.72 billion RMB [10][11]. - The net profit peaked at 10.51 billion RMB in 2022 but fell to 2.47 billion RMB in the first half of 2025, marking a 49% decline [11][12]. Profitability Challenges - Despite maintaining a high gross profit margin of 76.01% in the first half of 2025, the company's net profit margin has halved, indicating severe profitability erosion due to rising sales expenses [11][14]. - Sales expenses surged to 12.85 billion RMB in the first half of 2025, reflecting a sales expense ratio of 54.17%, which is significantly higher than previous years [10][14]. Strategic Issues - The company is facing a "traffic trap," where increased marketing spending is not translating into revenue growth, leading to a decline in marketing efficiency [15][16]. - Betaini's previous success relied on a "big single product + online marketing" model, which is now under pressure due to increased competition and rising customer acquisition costs [16][17]. Future Outlook - The success of new brands like "Aikeman" and the effectiveness of channel adjustments in platforms like Douyin are critical for future growth [18][19]. - The company's ability to control expenses and improve profitability will be essential for stabilizing its financial performance and regaining investor confidence [20].

Core Viewpoint - The company reported a significant decline in revenue and net profit for the first half of 2025, indicating challenges in sales performance and market conditions [1][2]. Financial Performance - Total revenue for H1 2025 was 2.372 billion yuan, a decrease of 15% year-on-year, with a net profit of 247 million yuan, down 49% [1]. - In Q2 2025, total revenue was 1.423 billion yuan, a decline of 17%, and net profit was 218 million yuan, down 29% [1]. Operational Strategy - The company implemented a differentiated membership and brand operation strategy, resulting in a gross margin increase of 2 percentage points to 75.04% in Q2 2025 [2]. - Sales expense ratio increased by 8 percentage points to 52.92%, primarily due to reduced revenue, while management expense ratio decreased by 1 percentage point to 5.22% [2]. Product Sales and Brand Positioning - Sales for key brands showed a decline: Winona down 18% to 1.95 billion yuan, Jierui down 11% to 212 million yuan, and Pomei down 5% to 24 million yuan [3]. - The company established a clear multi-brand matrix covering various segments, with Winona maintaining a leading position in the domestic dermatological skincare market [3]. Sales Channels - Revenue from online, OMO, and offline channels decreased by 6%, 10%, and 41% respectively, totaling 1.743 billion yuan, 191 million yuan, and 438 million yuan [3]. - The company continues to pursue a synergistic sales strategy between online and offline channels, with approximately 432,700 new users added to its OMO platform in H1 2025 [3]. Future Outlook - The company is expected to see growth from its OMO self-operated platform, improved brand matrix, and new product launches in sunscreen and anti-aging categories [4]. - EPS forecasts for 2025-2027 are projected at 1.36, 1.58, and 1.78 yuan, with corresponding PE ratios of 38, 32, and 29 times [4].

Summary of Key Points Core Viewpoint - On September 8, Betaini experienced significant trading activity with a total of 35 transactions on the block trading platform, amounting to 5.563 million shares and a total transaction value of 248 million yuan, with a discount of 12.33% compared to the closing price of the day [2][3]. Trading Activity - The average transaction price was 44.58 yuan, which was 12.33% lower than the closing price of 50.85 yuan on the same day [2][3]. - Institutional proprietary seats participated in 26 of the transactions, with a total transaction amount of 226 million yuan and a net purchase of 226 million yuan [2][3]. Market Performance - Betaini's closing price on September 8 was 50.85 yuan, reflecting an increase of 8.35% with a trading volume of 10.84 billion yuan and a turnover rate of 5.08% [2]. - Over the past five days, the stock has increased by 6.78%, while the net outflow of funds during this period totaled 101 million yuan [2]. Margin Trading Data - The latest margin financing balance for Betaini is 567 million yuan, showing a decrease of 5.31 million yuan over the past five days, which is a decline of 0.93% [3].

Group 1 - The cosmetics sector experienced a rise of 1.78% on September 8, with Betaini leading the gains [1] - The Shanghai Composite Index closed at 3826.84, up 0.38%, while the Shenzhen Component Index closed at 12666.84, up 0.61% [1] - Betaini's stock price increased by 8.35% to 50.85, with a trading volume of 215,100 shares and a transaction value of 1.084 billion yuan [1] Group 2 - The cosmetics sector saw a net outflow of 105 million yuan from institutional investors, while retail investors had a net inflow of 71.04 million yuan [2] - The stock performance of various companies showed mixed results, with some experiencing declines, such as Bavi Co., which fell by 3.12% [2] - Shanghai Jahwa's stock had a net inflow of 20.22 million yuan from institutional investors, despite a net outflow from retail investors [3]

Investment Rating - The report maintains a "Buy" rating for the cosmetics and medical beauty sector, highlighting strong growth potential and investment opportunities in the industry [14][19]. Core Insights - The cosmetics and medical beauty sector has shown resilience, outperforming the market during the week of August 29 to September 5, 2025, with the Shenwan Beauty Care Index declining only 0.8% [3][4]. - The transition to autumn skincare marks the beginning of a consumption peak for the sector, with significant sales events such as the Autumn Beauty Consumption Festival and Double 11 approaching, creating new investment opportunities [9][10]. - Major companies in the sector are optimistic about their performance in the second half of 2025, as indicated by a recent conference involving over ten beauty care companies [9]. Summary by Sections Industry Performance - The Shenwan Cosmetics Index remained stable, outperforming the Shenwan A Index by 1.4 percentage points, while the Shenwan Personal Care Index fell by 1.8%, underperforming the Shenwan A Index by 0.3 percentage points [3][4]. Key Company Reviews - **Mao Geping (1318HK)**: Reported a revenue of 2.59 billion yuan for H1 2025, a year-on-year increase of 31%, with a net profit of 670 million yuan, up 36%. The color cosmetics segment saw a revenue of 1.42 billion yuan, while skincare generated 1.09 billion yuan, reflecting strong brand momentum [10][11]. - **Shangmei Co. (02145HK)**: Achieved a revenue of 4.108 billion yuan in H1 2025, a 17.3% increase, with a net profit of 556 million yuan, up 34.7%. The main brand, Han Shu, contributed significantly to growth, with a revenue of 3.344 billion yuan [16][17]. Investment Recommendations - Recommended companies include Shangmei Co., Porlaia, and Shanghai Jahwa, which have strong brand matrices and relatively low PE multiples. Other notable mentions are Marubi Biological and Mao Geping, which are positioned well to benefit from the rise of domestic beauty brands [10][19]. - The report suggests focusing on companies with strong R&D capabilities and product pipelines, particularly in the upstream medical beauty segment, with a recommendation for Aimeike [10][19]. Market Trends - The report notes a significant increase in online sales, with H1 2025 online revenue for Mao Geping reaching 1.297 billion yuan, a 39% year-on-year increase, marking a shift in consumer purchasing behavior towards online platforms [12][18]. - The overall cosmetics retail market showed a 4.5% growth in July 2025, indicating a robust recovery in consumer spending [23][26]. Strategic Developments - Porlaia's investment in Huazhi Xiao reflects a strategic move to enhance its multi-brand strategy and capitalize on the influence of Gen Z consumers [28]. - The report highlights the competitive landscape, noting that domestic brands are increasingly capturing market share, with a notable shift in consumer perception from "value for money" to "quality choice" [32].

Core Viewpoint - The competitive landscape of the domestic beauty industry has shifted, with Juzhibio entering the top three and Betaini dropping out of the top five, highlighting significant changes in revenue and profit dynamics among key players [2][3]. Revenue Performance - Prolayya leads with a revenue of 5.362 billion yuan, followed by Shangmei with 4.108 billion yuan, and Juzhibio at 3.103 billion yuan, which represents a year-on-year increase of 22.55% [3][4]. - Betaini's revenue stands at 2.372 billion yuan, reflecting a decline of 15.43% compared to the previous year, marking a significant drop from its previous position as the third-largest player [3][4]. Profitability Analysis - Juzhibio reported a net profit of 1.182 billion yuan, up 20.2% year-on-year, while Betaini's net profit plummeted to 247 million yuan, a decrease of nearly 50% [4][8]. - The profit margin disparity is stark, with Juzhibio achieving a net profit margin of 37.9%, compared to Betaini's 10.4% [8][9]. Brand Strategy and Market Positioning - Juzhibio has successfully developed multiple sub-brands, such as Kefu Mei and Keli Jin, which contribute significantly to its revenue, while Betaini struggles with its primary brand, Weinuona, which has seen declining sales [4][15]. - The strategic focus on brand diversification and effective channel management has allowed Juzhibio to mitigate market fluctuations, whereas Betaini remains heavily reliant on a single brand [15][16]. Sales and Marketing Efficiency - Juzhibio maintains a lower sales expense ratio of 34.0%, while Betaini's sales expenses have surged to 54.2%, significantly impacting its profitability [8][9]. - The average selling price of Betaini's skincare products has decreased, contributing to its revenue decline, while Juzhibio's pricing strategy has allowed it to maintain higher margins [5][6]. Channel Development - Both companies initially built their brands through professional channels, but Juzhibio has expanded its direct sales and online presence more effectively than Betaini, which has seen a decline in offline sales [13][14]. - Juzhibio's direct sales accounted for 74.7% of its revenue, with significant growth in both online and offline channels, contrasting with Betaini's heavy reliance on e-commerce, which has faced challenges [13][14]. Future Outlook - The beauty industry consensus is shifting towards creating a brand matrix to diversify risk and extend growth, a strategy that Juzhibio has successfully implemented, while Betaini needs to develop additional brands to remain competitive [15][16].