Shenwan Hongyuan Securities·2025-06-02 08:15Investment Rating - The report maintains a positive outlook on the cosmetics and medical beauty industry, indicating a "Buy" recommendation for several companies within the sector [4][15]. Core Insights - The "food and beauty" theme is generating investment interest, leading to a resurgence in IPO activities within the beauty industry. Companies are increasingly launching skin care products that combine external application with internal health benefits, drawing parallels with international leaders like Shiseido [4][10]. - The international cosmetics and medical beauty companies are experiencing performance declines or slower growth rates, with recovery expected to take time. For instance, L'Oréal reported a 4.4% revenue growth in Q1 2025, but the Chinese market remained flat [11][13]. - The domestic high-end skincare brand Linqingxuan is set to become the first "national high-end skincare stock" in Hong Kong, with significant revenue growth and a strong market presence [22]. Summary by Sections Industry Performance - The cosmetics and medical beauty sector underperformed the market, with the Shenwan Beauty Care Index declining by 0.7% from May 23 to May 30, 2025, compared to a 0.6% decline in the Shenwan A Index [5][4]. Key Company Updates - Proya has entered the medical device sector with its first product, a medical-grade collagen patch, priced significantly lower than competitors. This move aligns with the growing demand for light medical beauty products [26]. - Shanghai Linqingxuan Biotechnology Co., Ltd. submitted its IPO application on May 29, 2025, aiming to capitalize on its leading position in the domestic high-end skincare market [22]. Market Trends - The beauty market is witnessing a shift towards high-efficiency ingredients and products that promote both external and internal beauty, with companies like Shuiyang launching effective beauty drinks [10]. - The overall retail sales of cosmetics in April 2025 grew by 7.2%, indicating a recovery in consumer demand [19][20]. Investment Recommendations - The report recommends several companies for investment, including Proya and Shangmei Co., Ltd., due to their strong brand matrices and growth potential. It also suggests focusing on companies that can leverage e-commerce platforms effectively [15].