Core Insights - Douyin e-commerce's GMV growth exceeded 30% in the first ten months of this year, with an annual GMV projected to surpass 4 trillion yuan, approaching Pinduoduo's level [1] - Douyin e-commerce's advertising revenue has surpassed Alibaba's, making it the leading platform in China for over a year [1] Group 1 - Taobao's payment GMV is at 6 trillion yuan, indicating that if both platforms maintain their current growth rates, Douyin could catch up in a few years [1] - There is a significant gap between Douyin e-commerce and Taobao when considering the final settlement GMV due to return rates [1] Group 2 - Douyin's life services business has also seen substantial growth, with a nearly 60% increase in the first ten months of this year [1]

Group 1 - The core point of this year's Double Eleven shopping festival is that it has become the longest in history, lasting 159 days, which is 4 days longer than last year, with major platforms averaging over 30 days of promotion [2][3] - During this year's Double Eleven, the total sales reached approximately 1.70 trillion yuan, a year-on-year increase of 14.2%, while the comprehensive e-commerce transaction volume grew by 12.3% [3][4] - The average daily sales during this year's Double Eleven were 462.6 billion yuan, indicating an 11% year-on-year decline, suggesting that the event has become less effective in stimulating consumer interest [4][8] Group 2 - The stagnation in the e-commerce market has led platforms to adopt strategies that may not be sustainable, as they attempt to maintain the appearance of growth [5] - The changing financial reporting metrics of major platforms, such as the shift from GMV to CMR and active buyer metrics, complicates the evaluation of their performance [7][8] - The lack of transparency regarding GMV growth in financial reports raises concerns about the competitive position of platforms like Taobao and Tmall [8][9] Group 3 - In response to limited GMV growth, platforms are increasing their take rates, which places additional financial pressure on merchants [9][10] - The introduction of new fees, such as a 0.6% technical service fee and full-site promotion costs, is aimed at increasing revenue from merchants [10][11] - Merchants are facing a complex fee structure that significantly reduces their profit margins, leading to dissatisfaction and potential exits from the platform [14][15][18] Group 4 - Other platforms, such as Xiaohongshu and Pinduoduo, are implementing measures to reduce costs for merchants, contrasting with Taobao's approach [26][27] - Alibaba's significant investments in AI and instant retail are driving the need for higher fees from merchants to support these initiatives [28][29][30] - The current strategy of increasing fees on merchants may lead to a long-term decline in merchant satisfaction and retention [30][31]

Core Insights - The financial results for the second quarter of FY '25 show a significant increase in GMV and EBITDA, indicating positive growth for the company [3]. Financial Performance - GMV increased by 11.9% year-on-year to JPY 312.4 billion [3] - GMV, excluding other GMV, increased by 12.2% year-on-year to JPY 292.6 billion [3] - EBITDA increased by 5.8% year-on-year to JPY 34.7 billion [3] - The EBITDA margin was 11.9%, reflecting a 0.7 percentage point decrease compared to the same period last year [3] Progress Against Company Plan - Progress against the revised company plan announced on July 31 shows GMV, excluding other GMV, at 44.8% and EBITDA at 45.3% [4]

Question-and-Answer SessionSo with that, Rob, let's jump right in and kind of start on the company's outlook for growth. You guys recently put out your '26 guidance with your fourth quarter report. So if you could just, from a high level, discuss the outlook for Q1 and the rest of '26 and give us some of the puts and takes that you're thinking about that may impact guidance.Robert O'HareChief Financial Officer Great. Of course, and thanks for hosting, Kyle. In terms of the guidance that we set, I think it's ...

Group 1 - The core viewpoint of the article highlights the significant decline in Oriental Selection's stock price and its financial performance, indicating ongoing challenges for the company [1][3][10] - Goldman Sachs has downgraded Oriental Selection's GMV forecast for the fiscal years 2026 to 2027 by 1% to 3%, while raising revenue forecasts by up to 10% due to increased contributions from self-operated brand products [3] - The adjusted net profit margin predictions for the fiscal years 2026 to 2027 have been increased by 0.2% and 1%, with a target price set at 9 HKD, although the firm maintains a sell rating due to persistent weak fundamentals and high valuations [3] Group 2 - Oriental Selection reported a 32.7% year-on-year decline in revenue for the fiscal year 2025, amounting to 4.4 billion CNY, and a staggering 97.5% drop in net profit, totaling 6.19 million CNY [10] - The company has lost over 1.86 million followers since July 2024, indicating a significant drop in audience engagement and market presence [11] - The impact of top streamers on traffic generation is difficult to replace in the short term, as Oriental Selection's main account has only made the Douyin sales leaderboard top ten four times this year, a stark contrast to its previous strong performance [11]

Core Viewpoint - Goldman Sachs has downgraded the GMV forecast for Dongfang Zhenxuan (01797) for the fiscal years 2026 to 2027 by 1% to 3%, while increasing revenue forecasts by up to 10% due to the rising contribution of self-operated brand products [1] Group 1 - The adjusted net profit margin forecast for fiscal years 2026 to 2027 has been raised by 0.2 and 1 percentage points [1] - The target price for Dongfang Zhenxuan has been increased from 8 HKD to 9 HKD [1] - Despite the adjustments, Goldman Sachs maintains a "Sell" rating on Dongfang Zhenxuan due to weak fundamentals and high valuations [1] Group 2 - For the half-year ending May this year, Dongfang Zhenxuan reported mixed performance, with GMV declining by 55% year-on-year to 3.9 billion RMB, which is 15% lower than Goldman Sachs' expectations [1] - The company managed to exceed earnings expectations by controlling operating expenses, resulting in a net profit growth of 30% to 135 million RMB for the fiscal year 2025, excluding the one-time impact from the sale of "Yuhui Tong" [1]

Summary of Key Points from Conference Call Industry Overview - The conference call discusses the **live e-commerce industry**, focusing on the **pet and health supplement sectors** and their performance from May to July 2025 [1][5][8]. Key Insights and Arguments Pet Industry - The pet industry had a small GMV share of 1.3% in May, 1.5% in June, and 1.1% in July 2025, but showed significant growth potential with major brands like **Mafudi**, **Fleegat**, and **Zhongchong** expected to exceed 50% growth in the first half of 2025 [1][4]. Health Supplement Industry - The health supplement sector experienced a **55% year-on-year growth** in Q2 2025, driven by relaxed platform policies that allowed new brands like **Wanyi Nan** and **Five Female Doctors** to gain traffic support [1][5][8]. - The platform's decision to ease restrictions was based on internal quality checks and the need to find new GMV growth points, as larger sectors like clothing and beauty had limited growth potential [8]. Brand GMV Share - Brand GMV share increased from approximately **62%-63%** at the beginning of the year to **69% in June** and **66% in July** 2025 [1][10]. Advertising Expenditure - E-commerce advertising expenditures for May, June, and July were **29.7 billion**, **31.2 billion**, and **25.6 billion** CNY respectively, with a stable ROI of around **2.5-2.7** [1][15]. Additional Important Content Platform Strategy - The platform's core business strategy focuses on content delivery, shelf scenarios, and brand support, prioritizing top brands for self-broadcasting and full shelf placement [2][16]. - The platform encourages mid-tier influencers to increase their broadcast frequency while reducing reliance on top-tier influencers to balance the ecosystem [19][20]. Brand Classification - Brands are classified into an S-level brand library based on their annual GMV and advertising budget contracts, with a minimum GMV requirement of **40 million** CNY [11][12]. ROI and Commission Policies - The ROI for merchants remained stable, with a slight increase in July compared to previous months. The commission policy has also seen an increase in rebate rates from **30% to 50%** compared to the previous year [15][26]. Market Dynamics - The platform aims to increase self-broadcast GMV from **63%** in 2025 to **70%-75%** in the next one to two years, indicating a strategic shift towards more cost-effective broadcasting methods [22]. New Brand Support Initiatives - New policies have been introduced to support new brands and white-label merchants, including cash rewards and resource packages to boost GMV growth in preparation for upcoming sales events [30]. Impact of Taxation - The potential impact of the advertising tax on platform and merchant operations remains uncertain, with significant implications depending on how influencer commissions are classified [37]. This summary encapsulates the essential insights and data from the conference call, highlighting the performance and strategic direction of the live e-commerce industry, particularly in the pet and health supplement sectors.

Core Viewpoint - Oriental Selection (01797) has seen a significant stock price increase of over 80% this month, with a current price of HKD 21.85 and a trading volume of HKD 1.147 billion [1] Group 1: Financial Performance - Daiwa reported that Oriental Selection's Gross Merchandise Volume (GMV) for the first half of the 2025 fiscal year is expected to be RMB 4.8 billion, with the "With Hui Together" channel led by Dong Yuhui contributing a quarter of this total [1] - Following Dong Yuhui's departure, the GMV has rebounded due to the expansion of sales channels, indicating a recovery in performance [1] - The gross margin for self-branded products has improved to a healthy level of 21% in the first half of 2025, up from 10% in the second half of 2024, attributed to reduced discounts [1] Group 2: Strategic Developments - The company has been reducing its workforce since December last year and expanding its product range to include high-margin categories such as health supplements and pet products, which is expected to further improve profit margins in the second half of 2025 [1] - Zheshang Securities noted that after two years of challenges, the company's operations are stabilizing, and GMV is expected to turn positive by June 2025 as the high base effect diminishes [1] - Oriental Selection continues to focus on developing major products, with GMV stabilizing and profit margins recovering, indicating significant growth potential for self-operated products [1]

Investment Rating - The industry investment rating is "In-Line" [5] Core Insights - The report highlights the size of the China hotel industry, its growth history, penetration rates, and key players, along with an analysis of gross merchandise value (GMV) and revenue per available room (RevPAR) trends [2][8] - The report discusses the competitive landscape, focusing on the top four hotel chains in China and their market dynamics [11][40] Market Size and Growth - The total number of hotels in China has grown significantly from 11,828 in 2005 to an estimated 348,717 in 2024, with branded hotels increasing from 864 to 93,289 in the same period [13] - The annual supply growth in China has shown fluctuations, with a notable decline of 30% in 2020, followed by recovery trends in subsequent years [9] Top Players - The report identifies the top four hotel chains in China: Jin Jiang, H World, BTG, and Atour, detailing their market presence and operational metrics [40] - Jin Jiang leads with 12,348 domestic hotels and a revenue percentage from food and management (F&M) of 52% [40] GMV Analysis - The breakdown of China hotel GMV indicates that online travel agencies (OTAs) account for 27% of bookings, with Ctrip being the largest player at 15% [43] - The report emphasizes the importance of direct bookings, which constitute 18% of the total GMV [43] RevPAR Trends - RevPAR in China has shown volatility, with a significant decline observed during the pandemic, but is expected to recover as leisure demand increases [49][72] - The report notes that RevPAR for branded hotels has outperformed other segments, particularly in the midscale category post-reopening [87][91] Key Debates - The report raises critical questions regarding the future of RevPAR in the second half of 2025, the impact of supply growth on pricing, and the confidence of franchisees amid potential hotel closures [94] Valuation Framework - The valuation section provides a comparative analysis of market capitalization and earnings metrics for the top hotel chains, indicating varying levels of market performance and investor expectations [104]

Summary of Conference Call Records Industry Overview - The conference call primarily discusses the beauty and e-commerce industry in China, focusing on the performance of various platforms during the 2025 618 shopping festival, including 淘天集团 (Taotian Group), 京东 (JD.com), 抖音 (Douyin), and 拼多多 (Pinduoduo) [1][2][3]. Key Points and Arguments Performance Metrics - 淘天集团's beauty segment exceeded expectations during the 618 shopping festival, with a GMV growth rate of 10.55% year-on-year, reaching 1,192.3 billion yuan, while the beauty segment specifically achieved a GMV of 98.4 billion yuan, growing 23.15% year-on-year [2][3]. - 京东's overall GMV target for the festival is approximately 2,500 billion yuan, with a growth target of 6.7% [3]. - 拼多多 aims for a GMV of 3,900 billion yuan with a target growth of 23% [3]. - 抖音's target GMV is around 4,800 billion yuan, with a growth target of 30% [3]. Strategic Collaborations and Market Trends - 淘天集团's collaboration with platforms like Tencent, Bilibili, and Xiaohongshu has attracted younger users and high-end consumers, leading to increased average transaction values and purchase frequency [1][4]. - The high-end luxury goods segment saw a sales increase of over 20% year-on-year, indicating a recovery in consumer spending among the middle class and above [4]. - International beauty brands have a higher pre-sale position compared to domestic brands, benefiting from commission reductions [1][5]. Advertising and Cost Management - 淘天集团's customer management fee (CM2) growth rate reached 12%, indicating a decrease in advertising consumption monetization rates, which helps merchants reduce costs [1][3]. - The platform has shifted from a "full reduction" strategy to a "direct reduction" strategy to maintain merchant profit margins while ensuring over 20% growth throughout the shopping period [11]. Sales Performance of Brands - Brands like 珀莱雅 (Proya) and 兰蔻 (Lancôme) reported significant sales, with 珀莱雅 achieving 5.69 billion yuan (12.46% growth) and 兰蔻 reaching 5.39 billion yuan (25.05% growth) [12]. - 国货品牌 (domestic brands) like 可复美 (Cofume) saw a sales increase of 39.62%, reaching 4.51 billion yuan [12][26]. Competitive Landscape - The competition between international and domestic brands is intensifying, with international brands maintaining a conservative pricing strategy to avoid diluting brand value [5][20]. - Domestic brands are leveraging aggressive advertising and competitive pricing to capture market share, with brands like 薇诺娜 (Winona) maintaining good performance through value-for-money strategies [20]. Future Outlook - 淘天集团's annual GMV target is set at 7.8 billion yuan, with a focus on achieving higher growth in Q2 and Q4 [7]. - The DAU (Daily Active Users) target for the platform is 480 million, with an AAC (Average Active Customers) target of 10.4 to 10.9 billion [7]. Additional Important Insights - The shift in promotional strategies, such as the introduction of AI-driven smart coupons, aims to enhance user experience and improve return rates [11]. - The overall market performance has shown significant improvement, with high-end and luxury products outpacing fast-moving consumer goods [5][6]. - The collaboration with influencers like 李佳琦 (Li Jiaqi) continues to play a crucial role in driving sales for both domestic and international brands [12][26]. This summary encapsulates the key insights and metrics from the conference call, highlighting the competitive dynamics and strategic initiatives within the beauty and e-commerce sectors during the 2025 shopping festival.