Investment Rating - The report suggests a positive investment outlook for the beauty and personal care sector, recommending a "buy" rating for high-growth companies with strong brand power and innovative product offerings [2][3]. Core Insights - The beauty and personal care sector is experiencing a slow recovery, with significant differentiation among sub-sectors. Personal care products and innovative channels continue to perform strongly, while the cosmetics sector shows signs of slowing growth due to domestic brand competition [1][2][3]. - For 2026, the overall beauty and personal care market is expected to remain stable, but further differentiation among companies is anticipated. The report emphasizes the importance of selecting high-growth targets with product and channel innovations [2][3]. Summary by Sections Overall Market Performance - In the first three quarters of 2025, the beauty and personal care sector saw revenues and net profits increase by 2.7% and 4.9% respectively, with personal care outperforming cosmetics and medical aesthetics [12][31]. - The cosmetics sector experienced a slight decline in revenue, with a 0.4% decrease year-on-year, while net profit fell by 2.3% [31][33]. Personal Care Sector - The personal care segment achieved revenues of 52 billion yuan and net profits of 5 billion yuan, reflecting a year-on-year increase of 33.7% and 5.7% respectively. The third quarter alone saw a revenue increase of 41.1% [12][16]. - Companies like Ruoyuchen reported impressive growth, with a 123% increase in revenue and a 73% increase in net profit in the third quarter [12][28]. Cosmetics Sector - The cosmetics sector's revenue for the first three quarters was 308 billion yuan, with a net profit of 30 billion yuan, showing a decline of 0.4% and 2.3% respectively. The third quarter saw a revenue drop of 0.5% but a significant profit increase of 50.8% [12][31]. - The report highlights the importance of individual company strategies and product life cycles in determining performance within the cosmetics sector [13][48]. Medical Aesthetics Sector - The medical aesthetics segment reported revenues of 75 billion yuan and net profits of 27 billion yuan, with a slight revenue decline of 0.7% but a profit increase of 14.5% year-on-year [12][52]. - The third quarter saw a revenue increase of 1.8% and a remarkable profit growth of 96.6%, although underlying performance was affected by increased competition and integration challenges [52][56]. Investment Recommendations - The report recommends focusing on high-growth companies with strong brand power, such as Ruoyuchen, Shangmei, and Maogeping, as well as companies with stable fundamentals and potential for marginal improvement like Dengkang Oral and Shanghai Jahwa [2][3]. - It also suggests monitoring companies that are expected to reach a turning point, such as Runben and Jinjian Biological, which may present investment opportunities [2][3].

Investment Rating - The report maintains a positive outlook on the cosmetics and medical beauty sector, with specific recommendations for companies like Maogeping and Shangmei Co. [4][9] Core Insights - The cosmetics and medical beauty sector underperformed the market during the reporting period, with the Shenwan Beauty Care Index declining by 3.1% [5] - The upcoming Double 11 shopping festival is expected to boost sales for Shangmei Co. and Maogeping, with strong performance anticipated on platforms like Douyin and Tmall [4][9] - Key companies such as Proya and Shanghai Jahwa reported mixed results, with Proya's revenue for Q3 2025 at 1.736 billion yuan, down 11.63% year-on-year, while Shanghai Jahwa's revenue grew by 28% to 1.483 billion yuan [10][15] Summary by Sections Industry Performance - The cosmetics and medical beauty sector showed a decline, with the Shenwan Cosmetics Index down 2.6% and the Shenwan Personal Care Index down 0.9% [5] - The top-performing stocks included *ST Meigu (+12.3%) and Jinsong New Materials (+6.2%), while Huaxi Biological and Beitaini saw declines of 7.8% and 7.4%, respectively [5] Company Performance - Proya's Q3 2025 revenue was 1.736 billion yuan, a decrease of 11.63% year-on-year, with a net profit of 227 million yuan, down 23.64% [10] - Shanghai Jahwa reported Q3 revenue of 1.483 billion yuan, an increase of 28%, with a net profit of 140 million yuan [15] - Ruoyuchen's Q3 revenue reached 819 million yuan, up 123.4% year-on-year, with a net profit of 33 million yuan [18] Market Trends - The 8th China International Import Expo showcased major international beauty brands, highlighting trends such as high-end market targeting and AI technology in beauty research and development [27] - The report indicates that the Chinese market is evolving into a global innovation hub for beauty products, with a focus on sustainability and green transformation [27] E-commerce Insights - The report provides data on the performance of domestic brands on platforms like Douyin and Tmall, with Shangmei Co. achieving significant growth in GMV [21] - The overall retail sales of cosmetics in September 2025 grew by 8.6%, driven by pre-Double 11 promotions [22][24]

Investment Rating - The report maintains a "Positive" outlook on the cosmetics and medical beauty industry, highlighting potential growth opportunities despite recent market underperformance [2]. Core Insights - The cosmetics and medical beauty sector has underperformed the market, with the Shenwan Beauty Care Index declining by 3.1% from October 31 to November 7, 2025 [3][4]. - The upcoming Double 11 shopping festival is expected to boost performance for companies like Shuangmei Co. and Maogeping, with strong sales anticipated on platforms like Douyin and Tmall [3][9]. - Key companies such as Proya, Shanghai Jahwa, and Ruifucheng have shown varying performance, with Proya's revenue for Q3 2025 at 1.736 billion yuan, down 11.63% year-on-year, while Shanghai Jahwa's revenue increased by 28% to 1.483 billion yuan [10][16]. Summary by Sections Industry Performance - The cosmetics and medical beauty sector has shown a decline, with the Shenwan Cosmetics Index down 2.6%, underperforming the Shenwan A Index by 3.3 percentage points [3][4]. - The top-performing stocks this week included *ST Meigu (+12.3%) and Jinsong New Materials (+6.2%), while Huaxi Biological and Beitaini saw declines of 7.8% and 7.4%, respectively [5]. Company Performance - Proya's Q3 2025 revenue was 1.736 billion yuan, a decrease of 11.63% year-on-year, with a net profit of 227 million yuan, down 23.64% [10][11]. - Shanghai Jahwa reported Q3 revenue of 1.483 billion yuan, up 28%, with a net profit of 140 million yuan [16]. - Ruifucheng's Q3 revenue reached 819 million yuan, a significant increase of 123.4% year-on-year, with a net profit of 33 million yuan [20]. Market Trends - The 8th China International Import Expo showcased international beauty brands, indicating a shift towards high-end markets and functional skincare products [31]. - The report highlights the increasing importance of e-commerce channels, with brands like Maogeping and Shuangmei Co. performing well on platforms like Tmall and Douyin [9][24]. E-commerce Data - In September 2025, the GMV for domestic brands on Douyin and Tmall showed significant growth, with Shuangmei Co. achieving a GMV of 8.1 billion yuan, up 47% year-on-year [24]. - The overall retail sales of cosmetics in September 2025 reached 368 billion yuan, reflecting an 8.6% year-on-year growth, driven by pre-Double 11 promotions [25][27].

Core Viewpoint - The pharmaceutical sector in both A-shares and Hong Kong stocks is experiencing a significant rally, driven by strong performance in medical devices, aesthetic medicine, innovative drugs, and traditional Chinese medicine, with various ETFs reflecting this upward trend [1][3][5][10]. Group 1: A-share Market Performance - A-share medical device stocks are leading the gains, with Ji'an Medical hitting the daily limit and Zhongyuan Hehe also reaching the limit, while the leading aesthetic medicine company, Aimeike, surged over 7% [1]. - The largest medical ETF in A-shares (512170) rose by 1.66%, with trading volume exceeding 400 million yuan, surpassing the previous day's total [1]. - The pharmaceutical sector in A-shares is also performing well, with Huadong Medicine leading with nearly a 6% increase, and other companies like Te Bao Biological and Jichuan Pharmaceutical also seeing gains [3]. Group 2: Hong Kong Market Performance - The Hong Kong Stock Connect's innovative drug sector saw a sharp rise, with the popular innovative drug ETF (520880) climbing by 1%, covering 37 innovative drug companies, most of which reported gains [5]. - Recent capital inflows have been significant, with the 520880 ETF receiving a net subscription of 130 million yuan last week [5]. Group 3: Investment Strategy and Recommendations - The current market conditions are viewed as a high-probability zone for medium to long-term investments in the biopharmaceutical sector, with recommendations for balanced allocations within the sector [6]. - Suggested investment strategies include focusing on innovative drug ETFs (520880), pharmaceutical ETFs (562050), and medical ETFs (512170), each with distinct characteristics and advantages [7]. - The medical ETF (512170) is noted for being the largest in the market, with a scale of 25.6 billion yuan, while the pharmaceutical ETF (562050) is the only one tracking the pharmaceutical index [8]. Group 4: Market Outlook - Analysts believe that the pharmaceutical sector is poised for a valuation recovery in the fourth quarter, supported by improved earnings and favorable policies, alongside a loose overseas liquidity environment [10]. - The completion of the third-quarter report disclosures and a shift in market style are expected to benefit innovative drugs, potentially leading to a new round of price increases [10].

Core Viewpoint - The stock of Giant Bio (02367) has rebounded over 6%, currently trading at 40.1 HKD with a transaction volume of 411 million HKD, following the approval of its first medical aesthetic product, a recombinant type I collagen freeze-dried fiber, for facial dermal tissue filling to correct dynamic wrinkles [1][1]. Group 1: Product Development - Giant Bio's approved product is aimed at correcting forehead dynamic wrinkles, including frown lines, forehead lines, and crow's feet [1]. - The company is currently developing three additional medical aesthetic products, which include facial hydration, neck wrinkle treatments, and volumizing fillers [1]. Group 2: Market Position and Challenges - According to Guotai Junan Securities, the main brand, Kefu Mei, has seen a decline in its Double Eleven ranking due to public sentiment, product structure, and competition, which may lead to temporary pressure on its skincare business [1]. - Despite these challenges, the company has strong brand assets and operational foundations, with a focus on future channel adjustments and new product launches [1]. Group 3: Growth Potential - The recombinant collagen product is recognized for its anti-aging and repair benefits, with a solid understanding of its components among consumers [1]. - The company has a foundational presence in the medical aesthetic channel, and the product's market entry is expected to contribute to a second growth curve for the company [1].

1. Report Industry Investment Rating - The industry rating is "Bullish" [1] 2. Core Views of the Report - The cosmetics industry continues to show differentiation, with brand demand being weak in the off - season, agents seeking change in difficult situations, and producers seizing supply - chain reconstruction opportunities. The medical aesthetics industry has new entrants with better - than - expected shipments, and new product catalysts are worth attention [3][4] 3. Summaries According to Relevant Catalogs 3.1 Cosmetics: Continued Differentiation 3.1.1 Brand Merchants - In 1 - 3Q25, beauty brand merchants' revenue was 28.4 billion yuan, a year - on - year decrease of 0.6%; personal care brand merchants' revenue was 5.7 billion yuan, a year - on - year increase of 12.4%. In 3Q25, beauty and personal care brand merchants' revenues were 8.05 billion and 1.805 billion yuan, a year - on - year decrease of 1.3% and an increase of 7.6% respectively. Beauty revenue weakened quarter - on - quarter, while personal care remained flat [18] - Beauty: Affected by the earlier Double Eleven promotion, consumer enthusiasm declined in September, and brands reduced live - streaming activities. In terms of single - quarter revenue growth, Shuiyang Co., Ltd. and Shanghai Jahwa increased by over 20%, Marubi Co., Ltd. had double - digit growth, Proya had low - double - digit decline, and Betaine and Freda had high - single - digit decline [18] - Personal care: Runben Co., Ltd.'s Q3 revenue increased by 17% year - on - year, with a slight increase in growth rate quarter - on - quarter. Baiya Co., Ltd.'s 3Q25 revenue improved, and Dengkang Oral Care had steady growth [18] - In 1 - 3Q25, beauty brand merchants' net profit after non - recurring items was 2.33 billion yuan, a year - on - year decrease of 15%; personal care brand merchants' was 604 million yuan, a year - on - year decrease of 3.4%. Some companies showed initial cost - control effects [24] 3.1.2 Agents - Agents are seeking change in difficult situations by exploring three paths: incubating self - owned brands (represented by Ruoyuchen), using AI to reduce costs and increase efficiency (represented by Yiwow), and expanding high - growth categories (such as Qingmu Technology expanding into trendy toy agency operations) [30] - Ruoyuchen's self - owned brands Feicui and Zhanjia continued to gain momentum. In Q3, self - owned brand revenue was 451 million yuan, a year - on - year increase of 344.5%, accounting for 55.1%. Zhanjia's Q3 revenue was 227 million yuan, a year - on - year increase of 119%, and 1 - 3Q revenue was 680 million yuan. Feicui's Q3 revenue was 203 million yuan, a quarter - on - quarter increase of over 98.8%, and 1 - 3Q revenue was 362 million yuan [30] 3.1.3 Producers - Demand continued to recover, and the revenue of the producer sector increased by 9%, 17%, and 30% year - on - year from Q1 to Q3, with the growth rate increasing quarter by quarter [33] - QingSong Co., Ltd. focused on optimizing customers and product structure, and its profit turned positive for four consecutive quarters from 2Q24 to 1Q25. Jieya Co., Ltd. had increasing orders from overseas big customers, and its Q3 performance growth accelerated. Jiaheng Home Co., Ltd. increased revenue but not profit, mainly due to the short - term impact of the Huzhou base's capacity ramp - up [33] 3.2 Medical Aesthetics: New Entrants with Better - than - Expected Shipments 3.2.1 Upstream Consumables - The growth rate of demand expansion slowed down, and supply - side competition intensified. In terms of the cumulative number of Class III medical device approvals, hyaluronic acid > regenerative (Sculptra/Poly - L - Lactic Acid) > botulinum toxin > recombinant collagen. Old products of hyaluronic acid and regenerative types faced growth pressure, and the growth rate of recombinant collagen Class III medical device products slowed down significantly quarter - on - quarter [38] - Hyaluronic acid: Aimeike's revenue growth rate from 24Q1 to 25Q3 was + 28.2%/+2.3%/+1.1%/ - 7%/ - 18%/ - 25%/ - 21% year - on - year, showing a quarterly decline since 24Q2 [38] - Collagen: Jinbo Biotech's revenue growth rate from 24Q1 to 25Q1 was + 76%/+100%/+92%/+73%/+63% year - on - year, and in 2Q25/3Q25, it was + 30%/+13% year - on - year. On October 23, the "Recombinant Type I α1 Subtype Collagen Freeze - Dried Fiber" Class III medical device certificate of Giant Biogene was approved by NMPA [38] - Leapmed Medical's medical aesthetics shipments were better than expected, with Q3 medical service and health management business revenue of 320 million yuan, a year - on - year increase of 28%, and the revenue of Sculptra and Hydrodermabrasion reaching 86.1367 million yuan [36] 3.2.2 Downstream - The new model of Xinoxygen Medical Clinics showed high - growth potential. The Q3 revenue guidance was 150 - 170 million yuan, a year - on - year increase of 231% - 275%, and a quarter - on - quarter increase of 4% - 18%. It plans to implement the "100 - City, 1000 - Store" plan in the long term [40] - Stores are expanding from first - tier cities to new first - tier and second - tier cities. As of November 6, it covered 42 stores in 10 cities. The promotion of self - owned brands was remarkable, and it cooperated with Xihong Miracle Sculptra 3.0, priced at 2999 yuan, which was officially launched on September 25 [43] 3.3 Investment Recommendations - Brands with upward potential and both growth and certainty: Recommend Maogeping (Oriental aesthetics, dual - wheel drive of makeup and skincare, and the second - curve of perfume is worth looking forward to) and Shangmei Co., Ltd. (with one cornerstone brand, five growth brands, and N seed businesses) [8][46] - Companies with new product pipelines and expected performance elasticity: Pay attention to Giant Biogene and Leapmed Medical [8][46] - Companies in strategic adjustment and expected to reach an inflection point: Recommend Shuiyang Co., Ltd. (the effect of high - end transformation is gradually emerging), and pay attention to Shanghai Jahwa, Betaine, and Freda [8][46]

Core Viewpoint - The beauty and personal care sector is experiencing significant differentiation, with personal care products and channel innovations continuing to perform strongly, while the domestic cosmetics market is seeing a slowdown in growth. The medical aesthetics sector is facing intensified competition, leading to a deceleration in growth [1][2]. Group 1: Industry Performance - In the first three quarters of 2025, revenue and net profit attributable to shareholders increased by 2.7% and 4.9% respectively, with personal care outperforming cosmetics and medical aesthetics [3]. - The personal care segment achieved revenue and net profit of 5.2 billion and 0.5 billion respectively, with year-on-year growth of 33.7% and 5.7%. In Q3 alone, revenue and net profit reached 1.8 billion and 0.17 billion, showing year-on-year growth of 41.1% and 3.3% [3]. - The cosmetics segment reported revenue and net profit of 30.8 billion and 3 billion respectively, with year-on-year changes of -0.4% and -2.3%. In Q3, revenue and net profit were 8.9 billion and 0.75 billion, with year-on-year changes of -0.5% and +50.8% [3]. - The medical aesthetics segment generated revenue and net profit of 7.5 billion and 2.7 billion respectively, with year-on-year changes of -0.7% and +14.5%. In Q3, revenue and net profit were 2.5 billion and 1.2 billion, with year-on-year changes of +1.8% and +96.6% [3]. Group 2: Investment Recommendations - The overall consumer market is in a slow recovery phase, with the beauty and personal care sector benefiting from product innovations and the rise of domestic brands, indicating strong growth potential. It is anticipated that the beauty and personal care sector will maintain stability in 2026, but differentiation will further intensify [2]. - The recommendation is to selectively invest in high-growth targets that exhibit product and channel changes, while also monitoring marginal improvement opportunities [2]. Group 3: Market Trends - The market share of the beauty and personal care sector is expected to increase due to the long-term logic of domestic brand growth, with high-growth targets continuing to attract incremental capital [4]. - The third quarter saw a decrease in market share to 7.29%, down 5.3 percentage points, influenced by factors such as intensified competition and reduced efficiency in traffic conversion [4][5].

Group 1 - The report highlights the significant achievements in the recent China-US trade talks, with the US agreeing to suspend certain tariffs on Chinese goods, which may positively impact trade dynamics [7] - The macroeconomic policy emphasizes the importance of expanding domestic demand and improving living standards, as outlined in the "15th Five-Year Plan" [5][6] - The report notes a shift in export growth, with October exports showing a decline of 1.1% year-on-year, influenced by high base effects from the previous year [11][12] Group 2 - The report discusses the rebalancing between technology and cyclical sectors, suggesting that both will play significant roles in the market moving forward [17][20] - It identifies the satellite industry as a strategic investment opportunity, driven by large market potential, strong policy support, and technological advancements [23][24] - The report indicates that the REIT market is showing resilience, with the recent listing of the CITIC Construction Investment Shenyang International Software Park REIT, which is expected to attract investment due to its high dividend yield [65][66]

Investment Rating - The investment rating for the beauty and personal care industry is "Positive" (maintained) [3] Core Viewpoints - The beauty market in China showed steady performance in Q1-Q3 2025, with retail sales of cosmetics growing by 3.9% year-on-year, surpassing the overall retail sales growth of consumer goods at 3.3% [4][5] - The high-end segment is expected to outperform the mass market, with projected CAGR for high-end skincare and makeup at 9.6% and 10.8% respectively from 2023 to 2028, compared to 8.2% and 6.7% for the mass market [6] Summary by Sections Market Performance - In Q1-Q3 2025, the beauty market maintained stable demand, with monthly retail sales growth fluctuating, peaking at 8.6% in September [4][5] - The personal care segment performed well, with revenue reaching 52.3 billion yuan, a year-on-year increase of 33.7% [16] Segment Analysis - Cosmetics segment revenue was 299.9 billion yuan, with a slight increase of 0.02%, while net profit decreased by 2.5% [16] - The medical beauty segment saw revenue of 74.9 billion yuan, a decrease of 0.7%, but net profit increased by 14.5% [16] - The personal care segment's revenue growth was driven by product innovation and expansion, with notable performances from companies like RuBen and RYTHM [16] Brand Competition - The competitive landscape is stable, with domestic brands like Proya and Han Shu gaining market share, particularly in platforms like Tmall and Douyin [11][12] - The report highlights the increasing strength of domestic brands due to their brand power and local advantages [12]

Core Insights - The retail industry is experiencing a shift from value preservation to emotional value, with a focus on high-growth segments for investment opportunities [5][28] - The report maintains a positive outlook on the retail sector, emphasizing the importance of consumer insights and differentiated product offerings [5][28] Retail Market Overview - The retail index reported a slight increase of 0.31% during the week of November 3 to November 7, 2025, underperforming the Shanghai Composite Index, which rose by 1.08% [7][16] - Year-to-date, the retail index has increased by 4.20%, lagging behind the Shanghai Composite Index's 19.27% growth [16][20] Investment Strategy for 2026 - The investment strategy highlights four main themes: 1. **Gold and Jewelry**: Focus on high-end and fashionable gold segments, with recommendations for brands like Lao Pu Gold and Chao Hong Ji [5][48] 2. **Retail E-commerce**: Emphasize the transformation of offline retail to enhance service and experience, with key players like Yonghui Supermarket and Ai Ying Shi [5][48] 3. **Cosmetics**: Target domestic brands that capture emotional value and innovate on safety ingredients, recommending brands like Juzi Biological and Pechoin [5][49] 4. **Medical Aesthetics**: Focus on differentiated product manufacturers and expanding medical institutions, with recommendations for brands like Ai Mei Ke and Ke Di-B [5][49] Sector Performance - The jewelry sector is undergoing significant changes due to rising gold prices and a decline in traditional wedding markets, leading to the emergence of brands with strong consumer insights [5][29] - The cosmetics sector is seeing a rise in domestic brands leveraging cultural roots and emotional value to capture market share [5][41] Company-Specific Insights - **Chao Hong Ji**: Reported a revenue increase of 28.4% year-on-year for the first three quarters of 2025, with a notable performance in Q3 [54] - **Yonghui Supermarket**: Experienced a revenue decline of 22.2% year-on-year for the first three quarters of 2025, but is undergoing significant transformation [50] - **Juzi Biological**: Achieved a revenue growth of 21.7% year-on-year for the first half of 2025, focusing on collagen products [50]