Core Viewpoint - Oriental Selection's stock price has experienced a significant decline, nearly halving from its recent peak, amid various negative news and financial performance issues [1][3]. Stock Performance - On August 26, Oriental Selection's stock closed at HKD 28.08 per share, down 11.2%, following a 12.89% drop the previous day, marking a total decline of nearly 23% over two days [2]. - The stock reached a recent high of HKD 53.7 per share on August 19, but has since dropped significantly, closing at HKD 34.32 per share on that day with a volatility exceeding 45% [3]. Financial Performance - For the fiscal year ending May 31, 2025, Oriental Selection reported total revenue of CNY 4.392 billion, a year-on-year decrease of 32.7%, primarily due to reduced sales in self-operated products and live e-commerce [6]. - The net profit for the period was CNY 6.19 million, a substantial decline from CNY 249 million in the previous fiscal year. Excluding financial impacts from Huizhong, the net profit from continuing operations was CNY 135 million, reflecting a 30% year-on-year increase [6]. - Goldman Sachs has downgraded its GMV forecast for Oriental Selection for the fiscal years 2026 to 2027 by 1% to 3%, while raising revenue forecasts by up to 10% due to improved contributions from self-branded products [6]. Management and Corporate News - Recent rumors regarding the departure of former CEO Sun Dongxu have circulated, but the company clarified that he is on an extended leave and has not resigned [9]. - The company has faced various rumors and negative press, which have contributed to the stock's volatility [7].

Core Viewpoint - Oriental Selection reported a significant decline in total revenue for the fiscal year 2025, with a total revenue of 4.4 billion yuan, down 32.7% from 6.5 billion yuan in fiscal year 2024, but managed to achieve a net profit of 6.2 million yuan after a loss in the first half of the year [1] Group 1: Financial Performance - The net profit for the fiscal year 2025 was 6.2 million yuan, a recovery from a net loss of 96.5 million yuan in the first half of the year [1] - Excluding the financial impact from the sale of Huixing, the net profit for the continuing operations was 135.4 million yuan, an increase of 30% year-on-year [1] - The gross margin for continuing operations improved from 25.9% in fiscal year 2024 to 32% in fiscal year 2025, attributed to the healthy development of self-operated products and live e-commerce [1] Group 2: Business Segments - The total GMV for self-operated products and live e-commerce in fiscal year 2025 was 8.7 billion yuan, a significant decrease from 14.3 billion yuan in fiscal year 2024 [1] - The total cost of revenue for continuing operations decreased from 4.8 billion yuan in fiscal year 2024 to 3 billion yuan in fiscal year 2025, a decline of 38.2%, mainly due to the decrease in GMV leading to lower inventory and logistics costs [1] Group 3: Market Position and Strategy - GMV from the Douyin platform still accounted for a large portion, while GMV from the Oriental Selection App increased its share from 8.4% in fiscal year 2024 to 15.7% in fiscal year 2025 [2] - The number of paid subscribers for the Oriental Selection App reached 264,300 in fiscal year 2025 [2] - Self-operated products accounted for approximately 43.8% of total GMV in fiscal year 2025, up from 40% in fiscal year 2024, with a total of 732 self-operated products launched [2] Group 4: Corporate Governance and Market Sentiment - The stock price of Oriental Selection has increased by over 200% since July [2] - There were rumors regarding the CEO of New Oriental Group being investigated for alleged misconduct, which Oriental Selection denied as baseless [2] - The company clarified that its average commission rate is below 20%, contrary to claims of exceeding 30% [2]