Core Viewpoint - The company, 正品控股, has applied for an IPO on the Hong Kong Stock Exchange, aiming to expand its market presence in Hong Kong and Taiwan amidst competitive pressures in the health and beauty supplement sector [1][3]. Market Position and Performance - 正品控股 ranks seventh among local health and beauty supplement suppliers in Hong Kong with a market share of approximately 1.6% and holds the top position in the deer-related health supplement segment with a market share of about 29.4% [1]. - The deer-related health supplement market in Hong Kong recorded sales of HKD 158.5 million in 2020, projected to grow to HKD 222 million by 2024, reflecting a strong compound annual growth rate (CAGR) of 8.7% [1]. Customer Dependency - The largest customer, Dairy Farm International Holdings Ltd. (牛奶公司), accounts for a significant portion of 正品控股's revenue, contributing approximately HKD 97.1 million in the 2025 fiscal year, which is 74.5% of the total revenue [3][7]. - The company has maintained a stable relationship with Dairy Farm for 12 years, primarily selling products through wholesale channels [2]. Revenue Concentration Risks - The revenue from the top five customers represents a high concentration risk, with contributions of approximately 90.6%, 89.4%, and 83.4% of total revenue from 2023 to 2025 [7]. - The company faces potential cash flow risks due to reliance on a single major customer, as evidenced by increasing product returns from Dairy Farm, which reached HKD 5 million in 2025, over four times the amount in 2024 [8][10]. Supplier Dependency - 正品控股 also exhibits high supplier concentration, with the top five suppliers accounting for approximately 86.3%, 77.3%, and 80.3% of total purchases from 2023 to 2025 [11]. - A notable supplier, identified as Supplier K, was previously an affiliate of the company's controlling shareholder, raising concerns about potential conflicts of interest [11]. Financial Performance - The company's gross margin has been declining, recorded at 81.59%, 78.62%, and 75.02% from 2023 to 2025, attributed to increased promotional discounts and a shift towards lower-margin third-party brand sales [13][15]. - Administrative expenses have been growing at an annual rate of 50%, indicating potential management inefficiencies [16]. Market Outlook - The health and beauty supplement market in Hong Kong is expected to grow from approximately HKD 15.8 billion in 2024 to HKD 19.1 billion by 2029, with a CAGR of about 3.8%, providing growth opportunities for 正品控股 [19]. - However, the market is highly competitive and fragmented, with the top ten suppliers holding only 55.3% of the market share, indicating challenges for new entrants [20][21].

Group 1 - The company expects to achieve a consolidated net profit of approximately $14.075 million in the first half of 2025, representing a year-on-year increase of 26.7%, primarily due to increased revenue and gross profit during the reporting period [1] - The unaudited consolidated revenue for the reporting period is anticipated to be around $244 million, an increase of approximately 49.3% compared to the previous period, driven by sales growth in beauty products from YesStyle and AsianBeautyWholesale [1] - The unaudited consolidated gross profit is expected to be about $73.262 million, up approximately 46.0% from the previous period, with a stable gross margin of around 30.0%, slightly down from 30.7% in the prior period [1] Group 2 - To support the rapid growth of the B2B segment, the company has established an ABW office in South Korea with a sales team of over 15 people and set up a B2B warehouse covering approximately 147,000 square feet [2] - The company has strengthened its marketing teams in Hong Kong and Berlin to enhance B2C marketing efforts and expanded its B2B sales team in Hong Kong [2] - The net profit margin for the reporting period is 5.8%, down from 6.8% in the previous period, but still exceeding the net profit margin of approximately 4.4% for the second half of 2024 and about 5.5% for the entire year of 2024 [2]