Core Viewpoint - The company has shown a positive performance in the first half of 2025, with revenue growth driven by its product lines, despite challenges in the e-commerce channel due to public sentiment issues [1][3]. Financial Performance - In the first half of 2025, the company achieved operating revenue of 1.764 billion, a year-on-year increase of 15.1%, and a net profit attributable to shareholders of 188 million, up 4.6% [2][3]. Product Performance - The company's sanitary napkin product line generated revenue of 1.688 billion, reflecting a year-on-year growth of 20.5%. The health product series, represented by probiotics and organic cotton products, has seen faster revenue growth and an increasing revenue share [3]. Channel Performance - E-commerce revenue faced a decline of 9.4% year-on-year due to public sentiment impacts, while offline sales reached 1.133 billion, growing by 39.8% year-on-year. The company plans to increase resource investment in peripheral provinces to enhance national market expansion [3][4]. Sales and Marketing Expenses - Sales expenses amounted to 642 million, up 18.8%, with a sales expense ratio of 36.4%. The increase in expenses was primarily due to additional budget allocations for brand and online platform marketing in response to public sentiment [3]. Strategic Initiatives - The company is actively embracing the rise of instant retail channels and has established a dedicated department for channel development. It aims to adapt product offerings and focus resources on capturing growth opportunities in this area [4][6]. E-commerce Channel Recovery - The return on investment (ROI) for the online channel has largely recovered to the previous year's levels, with competition dynamics shifting. The company maintains a strong competitive edge through innovative marketing and product iteration [5][7]. Future Product Development - The company is increasing resource allocation for its organic cotton product line, anticipating better performance in the second half of the year due to strong consumer demand [6][9]. Regional Expansion - The company is accelerating its expansion in non-core provinces, with a more aggressive pace than initially planned. The overall market share is on an upward trend across different regions [8][10].

Investment Rating - The investment rating for the company is "Outperform the Market" [6][4]. Core Views - The company experienced short-term pressure on performance due to the 315 public opinion incident, with a revenue of 1.764 billion yuan in the first half of the year, a year-on-year increase of 15.12%, and a net profit of 188 million yuan, a year-on-year increase of 4.64% [1][8]. - The company has shown strong performance in offline channels and significant growth in peripheral markets, which supports overall revenue stability despite challenges in online sales [1][4]. - The company is expected to see improved performance in the second half of the year as the impact of the public opinion incident diminishes, alongside strong promotion of new products [4][17]. Summary by Sections Financial Performance - In the first half of the year, the company achieved a revenue of 1.764 billion yuan, with a net profit of 188 million yuan, and a non-recurring net profit of 182 million yuan, reflecting year-on-year growth of 15.12%, 4.64%, and 6.06% respectively [1][8]. - In the second quarter, revenue was 769 million yuan, remaining flat year-on-year, while net profit decreased by 25.5% to 57 million yuan due to the impact of the public opinion incident [1][8]. Product and Channel Analysis - The company's "Free Point" brand generated 1.687 billion yuan in revenue in the first half, a year-on-year increase of 20.5%, with health products accounting for over 50% of total revenue [2][8]. - Offline channels performed strongly, with revenue of 1.133 billion yuan, a year-on-year increase of 39.8%, while online channels faced a decline of 9.44% to 592 million yuan due to the public opinion incident [2][9]. Profitability and Cost Structure - The company's gross margin and net profit margin for Q2 were 53.14% and 7.47%, respectively, showing a decline due to revenue pressure and accounting adjustments [3][13]. - The sales expense ratio increased as the company invested more in market promotion and brand awareness in response to the public opinion incident [3][13]. Future Outlook - The company maintains profit forecasts for 2025-2027 at 368 million, 483 million, and 627 million yuan, with corresponding P/E ratios of 35, 26, and 20 times [4][17]. - The company is expected to benefit from the gradual recovery of online business and the promotion of new organic cotton and vitamin E products, which may enhance average transaction value and gross margin [4][17].