Investment Rating - The report maintains a "Positive" outlook on the cosmetics and medical beauty industry, indicating potential growth opportunities in the sector [2]. Core Insights - The domestic brands showcased strong performance on Douyin, with Feicui achieving a GMV of nearly 500 million, marking a new high for the year [6][12]. - The cosmetics and medical beauty sector performed in line with the market, with the Shenwan Beauty Care Index rising by 1.6% from May 30 to June 6, 2025 [6][7]. - International cosmetic companies are experiencing a decline or slowdown in growth, with L'Oréal's Q1 2025 revenue growth at 4.4%, and Estée Lauder facing a significant drop in revenue and operating profit [13][15][16]. Summary by Sections Industry Performance - The Shenwan Beauty Care Index increased by 1.6%, while the Shenwan Cosmetics Index rose by 0.7%, slightly underperforming the Shenwan A Index [6][7]. - Domestic brands like Marubi and Yilian have shown over 50% growth in skincare, while color cosmetics brands like Caitang and Maogeping achieved over 70% growth [12]. Key Developments - Leping Medical's "童颜针" (Youthful Needle) received approval, marking a competitive entry into the domestic market for facial fillers [26]. - Furuida's synthetic royal jelly acid (10-HDA) has achieved industrialization, providing a high-purity ingredient for anti-aging products [27]. Investment Recommendations - Recommended stocks include: 1. Upstream companies with strong R&D capabilities and profitability, such as Aimeike [17]. 2. Brands benefiting from Douyin traffic, like Marubi [17]. 3. Companies with strong product innovation and cost-effectiveness, such as Runben and Furuida [17]. - Suggested to pay attention to Shanghai Jahwa, Betaini, Huaxi Biological, and Water Sheep [17]. Market Trends - The cosmetics market in China is projected to grow, with a retail sales increase of 7.2% in April 2025, indicating a recovery in consumer demand [23][25]. - The market share of domestic brands in the skincare segment has improved significantly, with domestic brands occupying five out of the top ten positions in market share [36][37].