East Money Securities·2025-12-29 08:37Investment Rating - The report maintains an "Outperform" rating for the beauty and personal care industry, indicating a positive outlook for growth opportunities in the sector [3]. Core Insights - The report emphasizes that innovation in ingredients, particularly new materials like PDRN (Polydeoxyribonucleotide) and ECM (Extracellular Matrix), is a significant driver for growth in the beauty and medical aesthetics industry. Companies that successfully integrate these new components into their product lines are expected to enhance their growth potential and market competitiveness [5][14]. Summary by Sections 1. PDRN: A New Ingredient Driving Growth - PDRN has been validated in overseas markets for over a decade and is recognized for its effectiveness in promoting tissue regeneration and anti-inflammatory properties. The introduction of PDRN products in the medical aesthetics sector has shown a compound annual growth rate (CAGR) of 30% from 2014 to 2024 for companies like PharmaResearch, which has established a strong market presence with its Rejuran product line [5][18][32]. - The domestic market for PDRN is expected to grow significantly, with a projected revenue of approximately 330 million RMB from Q4 2024 to Q3 2025, indicating robust demand for PDRN products in China [5][20]. - The report highlights that the increasing awareness and education around PDRN among consumers, coupled with regulatory clarity and rapid supply chain development, will further drive demand in the medical aesthetics sector [5][68]. 2. ECM: Potential in Regenerative Fields - ECM is gaining attention as a promising ingredient in both medical aesthetics and cosmetics, with applications in serious medical fields already established. The report notes that the market for ECM products is still developing, with several companies beginning to explore its potential in aesthetic applications [5][24][28]. - The report suggests that the introduction of ECM products could fill existing gaps in the market, particularly in the medical aesthetics sector, where consumer education and awareness are crucial for adoption [5][24]. 3. Investment Opportunities - The report recommends focusing on companies with established pipelines for new materials, particularly in the medical aesthetics sector, such as Lepu Medical and Marubi Biotechnology, which are expected to lead in the approval and commercialization of PDRN products [5][6]. - In the cosmetics sector, brands that are quick to adopt PDRN and other innovative ingredients are likely to gain a competitive edge, with several major brands already launching PDRN-infused products in 2025 [5][6].