Core Viewpoint - The company, Shanghai Kaijie E-commerce Co., Ltd. (hereinafter referred to as "Kaijie E-commerce"), has submitted its IPO application to the Hong Kong Stock Exchange, marking its fourth attempt to enter the capital market after previous unsuccessful attempts in 2016, 2021, and 2023. The company aims to raise funds for strategic business expansion, technology procurement, marketing, and enhancing digital capabilities [1][2]. Industry Overview - The beauty e-commerce agency industry has experienced significant structural changes since 2021, with a slowdown in growth and market differentiation. The compound annual growth rate (CAGR) was approximately 25% before 2021, with the market size projected to grow from 30 billion yuan in 2020 to 80 billion yuan by 2025. However, recent years have seen a decline in growth rates due to rising traffic costs and the trend of international brands establishing their own teams [2][5]. - Among six selected listed companies in the industry, four reported revenue declines, with notable drops in companies like Liren Lizhuang, which saw a 37.44% decrease in revenue and a net profit loss of 182.64% [2][3]. Company Performance - Kaijie E-commerce's revenue and net profit have declined for three consecutive years from 2022 to 2024, with revenues of 1.829 billion yuan, 1.723 billion yuan, and 1.699 billion yuan, reflecting decreases of 5.8% and 1.4% in 2023 and 2024, respectively. Net profits also fell to 86 million yuan, 68 million yuan, and 60 million yuan, with declines of 21.8% and 10.6% in the same years [5][9]. - The company's gross profit margin has decreased from 24% in 2022 to 21.8% in 2024, with both to-C and to-B business segments experiencing declines in their respective margins [7][9]. Dependency on Major Brands - Kaijie E-commerce has shown a growing dependency on its top five brands, with their contribution to Gross Merchandise Volume (GMV) increasing from 64.4% in 2022 to 80.4% in 2024. However, the revenue contribution from these brands has not kept pace, indicating a potential weakening of the company's bargaining power with these clients [11][12][14]. - The company has served over 200 brands, but the revenue from the top five brands has decreased from 62.2% in 2022 to 52.8% in 2024, highlighting a concerning trend in revenue generation despite increasing GMV [12][14].

Core Viewpoint - Alibaba's complete exit from Liren Lizhuang after 13 years of investment indicates a significant shift in the company's strategic direction and highlights the challenges faced by Liren Lizhuang in recent years [2][3][6]. Group 1: Alibaba's Exit - Liren Lizhuang announced that Hangzhou Haoyue, an Alibaba subsidiary, sold all its shares, totaling 70.38 million shares, which represents 17.57% of the company's total equity, for a total price of 486 million yuan at 6.9 yuan per share [3]. - The exit marks the end of a partnership that began in 2012 when Alibaba invested in Liren Lizhuang, initially acquiring a 20% stake [3][4]. - The departure of board member Han Wenfei, who has been closely associated with Alibaba's investment in Liren Lizhuang, further signifies the end of Alibaba's involvement [4][6]. Group 2: Financial Performance - Liren Lizhuang reported a loss of 24.4 million yuan in 2024 and 18.32 million yuan in Q1 2025, with a revenue decline of 14.78% in 2023 and a 21.98% drop in 2022 [7][8]. - The company attributed its revenue decline primarily to the termination of partnerships with several major brands, including L'Oreal and Lancôme, which has significantly impacted its business model [7][8]. - The company's self-owned brand development has been slow, with self-owned brands accounting for less than 10% of total revenue as of 2023 [8]. Group 3: Strategic Shift - Liren Lizhuang is facing challenges due to the changing landscape of online retail, with traditional e-commerce channels losing traction [10][11]. - The company aims to reduce its reliance on single traffic platforms and enhance the development of its self-owned brands, with plans to focus on brands like "Yurongchu" and "Meiyitang" [10][11]. - In 2023, Liren Lizhuang reported a significant net profit increase of 121.19%, attributed to strong growth in emerging channels, with over 15% of revenue coming from new platforms like Douyin [11].