Summary of Marubi Biotech Conference Call Company Overview - **Company**: Marubi Biotech - **Industry**: Beauty and Health Key Points and Arguments Financial Performance and Strategy - Marubi Biotech has improved its gross margin significantly by streamlining SKUs and implementing a big product strategy, particularly with the Xiaohongbi and Xiaojin series. The supply chain turnover period has been reduced from 90 days to approximately 40 days, enhancing operational efficiency. The additional profits will be reinvested into market sales expenses [2][5][6]. - In 2024, the online GMV for Xiaohongbi reached 530 million yuan, nearly doubling year-on-year, accounting for about 25% of the main brand. The Xiaojin series also saw a growth rate of approximately 90%. The company aims for at least a 50% growth in these two major products by 2025, with expectations for Xiaojin cream and Super Mask to achieve sales in the hundreds of millions [2][7][12]. Sales Channels and Marketing - Marubi's sales on content e-commerce platforms like Douyin and Kuaishou account for over 40%, with Tmall around 30% and Vipshop about 20%. The remaining sales are distributed across platforms like JD and Pinduoduo, with net profit levels across channels being relatively similar [2][15]. - The company has shifted its marketing strategy to focus on long-term growth rather than short-term sales spikes, with a series of marketing activities planned leading up to major sales events like 618 [3][12]. Product Development and Innovation - Marubi is actively expanding its product lines in the beauty and health sectors, including functional skincare brands and oral care products. The company has also invested in medical beauty projects, such as Shuangmei Biotech [2][20][21]. - The company has established a dual beauty strategy combining lifestyle beauty and medical beauty, with expectations for significant results in the medical beauty sector within three years [5][22]. Supply Chain and Operational Efficiency - The company has implemented measures to enhance supply chain efficiency, particularly in transitioning from a B2B to a B2C model, requiring faster delivery times and improved product variety [6][7]. - The integration of front, middle, and back-end management has led to significant improvements in operational speed and gross margin [6][7]. Market Trends and Consumer Behavior - The beauty market is experiencing structural changes, with a trend towards younger consumers and a shift in purchasing habits. The company aims to attract younger demographics to build brand loyalty [14][26]. - The competition in the beauty industry is intense, with a focus on product quality, content, and operational capabilities being crucial for success [29]. Future Outlook - 2025 is considered a pivotal year for Marubi, as the company aims to maintain its growth trajectory amidst increasing market competition. The company has set a three-year goal to validate its online transformation success [25][33]. - The company is also exploring opportunities for external investments and brand acquisitions, although current growth from existing brands is deemed sufficient for the near future [23][24]. Additional Important Insights - The company has a robust technical research system, particularly in collagen technology, which supports its product development and market competitiveness [22][30]. - Marubi's non-main business income primarily comes from investment subsidies and returns, indicating a diversified revenue stream [18]. This summary encapsulates the key insights from the conference call, highlighting Marubi Biotech's strategic initiatives, market positioning, and future growth plans.

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The report highlights that the company has received approval for the first domestic Class III medical device registration for hydroxyapatite microspheres, indicating a significant advancement in its medical aesthetics strategy [6][8] - The company is expected to maintain steady growth, with projected revenues of 28.92 billion, 35.90 billion, and 42.58 billion for the years 2024, 2025, and 2026 respectively, reflecting year-on-year growth rates of 29.94%, 24.15%, and 18.60% [9][11] - The report emphasizes the company's strategic focus on the "dual beauty" strategy, which integrates beauty and health, and its proactive investments in various beauty-related sectors [8][9] Summary by Sections Investment Rating - The company maintains an "Increase" rating, indicating a favorable outlook compared to the market [2] Financial Performance - The company's main revenue is projected to grow from 17.32 billion in 2022 to 42.58 billion by 2026, with net profit increasing from 1.74 billion to 5.33 billion in the same period [7][11] - Earnings per share (EPS) are expected to rise from 0.43 in 2022 to 1.33 in 2026, reflecting a positive trend in profitability [7][11] Market Position - The report notes that the hydroxyapatite microsphere product has shown strong market demand, with a 21% year-on-year increase in treatment numbers in the U.S. in 2022 [8] - The company is expanding its product offerings in the color cosmetics sector, which is expected to serve as a new growth engine [9] Strategic Initiatives - The company is actively investing in various beauty and health-related businesses, including partnerships with firms specializing in regenerative materials and high-end beauty devices [8][9]