Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company reported a revenue of 860 million yuan for the first half of 2025, representing a year-on-year growth of 42.4%, with a net profit attributable to shareholders of 390 million yuan, up 26.7% year-on-year [5] - The medical device segment showed rapid growth, with revenues of 708 million yuan, a year-on-year increase of 33.41%, while the functional skincare segment grew by 152.39% to 121 million yuan [6] - The company is expanding its market presence through strategic partnerships and product launches, including the introduction of new collagen products [10] Summary by Sections Financial Performance - In Q2 2025, the company achieved revenues of 490 million yuan, a 30.4% increase year-on-year, and a net profit of 220 million yuan, growing 7.4% year-on-year [5] - The gross margin for the first half of 2025 was 90.7%, down 0.9 percentage points year-on-year, while the net profit margin decreased to 45.7% [6][8] Business Segments - Revenue breakdown for H1 2025: Medical devices accounted for 82.5% of total revenue, functional skincare 14.1%, and raw materials 3.1% [6] - The medical device revenue was further divided into single-material and composite-material devices, with respective revenues of 645 million yuan and 63 million yuan, growing 34.70% and 21.52% year-on-year [6] Regional Performance - Revenue by region for H1 2025: North China 365 million yuan (+25.66%), East China 287 million yuan (+72.95%), South China 79 million yuan (+17.88%), and West China 85 million yuan (+79.68%) [7] Cost Structure - The company's selling expenses increased due to higher marketing investments and stock incentive plans, leading to a rise in the selling expense ratio to 21.1% [9] - The total operating expense ratio for H1 2025 was 34.9%, up 2.9 percentage points year-on-year [9] Future Outlook - The company plans to enhance its brand promotion and has adjusted its sales expense forecasts for 2025-2027, with expected net profits of 1.01 billion yuan in 2025 [11] - The introduction of strategic investors is anticipated to strengthen the company's market position and growth potential [11]

Core Insights - The acquisition of Baizhichui by Juyi Group marks a significant step in the company's strategy to expand into the scientific skincare sector, enhancing its multi-brand and multi-category beauty matrix [1][4] - The global functional skincare market is experiencing intense competition, with both international giants and local brands accelerating their presence in this lucrative segment [6][7] Company Overview - Juyi Group, established in 2016 and headquartered in Shanghai, owns two major color cosmetics brands, Judydoll and Jooycee, and has a partnership with Pierre Fabre Laboratories for the René Furterer brand in China [4] - The group reported a retail revenue exceeding 4.2 billion yuan and an income of 3.5 billion yuan in 2024, reflecting a year-on-year growth of 36% [4] Acquisition Details - Baizhichui, founded in 2012 and part of Meiji Biotechnology (Shanghai) Co., focuses on providing solutions for problematic and sensitive skin, emphasizing a "plant + technology" research approach [4][5] - Post-acquisition, Professor Li Yuanhong will continue as Chief Product Officer, overseeing the entire product development process, while co-founder and CEO Sun Hui will serve as a lifetime honorary advisor [5] Market Trends - The global professional skincare market reached a size of $35.77 billion in 2022, with projections to exceed $77.51 billion by 2030, reflecting a compound annual growth rate (CAGR) of 9.9% [6] - In China, the functional skincare sector saw a CAGR of 36.7% from 2017 to 2021, with a market size of approximately 46.43 billion yuan in 2022, marking a year-on-year growth of 22.9% [6] Competitive Landscape - Major global beauty companies like L'Oréal and Estée Lauder are increasingly investing in functional skincare through acquisitions and partnerships, indicating a strategic shift towards professional medical beauty [7][8] - Local brands such as Winona and Juzi Biotechnology are also capturing market share through differentiated strategies, with Juzi Biotechnology reporting a revenue of 5.539 billion yuan in 2024, a year-on-year increase of 57.2% [8]