Core Viewpoint - Focus International Limited, a manufacturer of disposable hygiene products, has submitted a prospectus to the Hong Kong Stock Exchange for a listing on the main board, amidst a competitive market environment for similar companies [2] Company Overview - Focus International was established in 2014 and initially operated as an OEM for international brands in absorbent hygiene products, later developing its own brands [3] - The company’s product categories include baby care products, feminine care products, and adult incontinence products, while also engaging in hygiene product materials business [3][4] - The company plans to cease its adult incontinence product line by August 2024 to optimize resource allocation and focus on higher growth potential core business segments [3] Financial Performance - Focus International has shown significant growth in operating performance over the past three years, with revenues of 181.24 million RMB, 372.32 million RMB, and 447.05 million RMB for the years 2022, 2023, and 2024 respectively [5][6] - Gross profits for the same years were 35.12 million RMB, 87.59 million RMB, and 122.78 million RMB, indicating a rising gross margin trend of approximately 19.4%, 23.5%, and 27.5% [6] - Net profits also increased significantly, with net income and other comprehensive income of 12.27 million RMB, 39.47 million RMB, and 65.61 million RMB for the respective years [6] Market Position and Strategy - The company benefits from growing consumer demand and a multi-brand strategy that has led to rapid expansion in China [7] - Focus International maintains a processing business that serves both domestic and international markets, primarily in Southeast Asia [4][7] - Despite its growth, the company’s gross margin is lower compared to peers like Hengan International and Sofy International, which have gross margins exceeding 30% [7] Ownership Structure - The company is highly concentrated in ownership, with the founder Zhou Hang and his wife holding a combined 99% of the shares, which may raise governance concerns among institutional investors [8][10] - Zhou Hang, the founder and CEO, is notably young at 35 years old, having started the company at 24 [7][10]

Core Viewpoint - The wave of "her economy" is drawing attention to the absorbent hygiene products sector, with Focus International officially submitting its IPO application to the Hong Kong Stock Exchange on June 26, 2023 [1] Company Overview - Focus International, established in 2014, specializes in the manufacturing and sales of absorbent hygiene products, categorized into three types: baby care products, female care products, and adult incontinence products. The company also sells hygiene product materials [1] - The company employs a multi-brand strategy, primarily offering a diverse range of absorbent hygiene products in China, including brands like "Cotton Hour," "Focus Baby," and "Baimule" for baby care, and "Weiyue" and "Blue Cotton" for female care [1] Financial Performance - The company has experienced significant revenue growth, with total revenues projected to reach RMB 1.81 billion, RMB 3.72 billion, and RMB 4.47 billion for the fiscal years 2022 to 2024, respectively, reflecting a compound annual growth rate (CAGR) of 57.2% [2][3] - Net profits for the same period are expected to be approximately RMB 12.27 million, RMB 39.47 million, and RMB 65.61 million, indicating steady growth in both revenue and profit [2][3] - The gross profit margin has also improved, increasing from 19.4% in 2022 to 27.5% in 2024 [2] Business Segmentation - Focus International's operations are divided into three segments: OEM (Original Equipment Manufacturer) business, brand business, and hygiene product materials. The brand business has seen a significant increase, with revenues growing by 865% from RMB 13.47 million in 2022 to RMB 130 million in 2023, driven by digital marketing and increased penetration in e-commerce channels [3][4] - The revenue contribution from the brand business is expected to surpass that of hygiene product materials for the first time in 2024, marking a shift in the company's revenue structure [4] Market Trends - The overall market for disposable hygiene products in China is projected to grow from RMB 1,442 billion in 2020 to RMB 1,517 billion in 2024, with a CAGR of approximately 1.3% [7] - The female hygiene segment is expected to grow significantly, with sales projected to increase from RMB 613 billion in 2020 to RMB 867 billion in 2024, reflecting a CAGR of 9.1% [6][12] - Conversely, the baby care segment is facing a decline, with sales expected to drop from RMB 714 billion in 2020 to RMB 513 billion in 2024, indicating a CAGR of -7.9% [6][12] Production Capacity - Focus International operates eight production lines in Quanzhou, Fujian, with high utilization rates for baby care products (97.2% for baby pull-ups and 90.1% for diapers) [5] - However, the adult incontinence product line shows low utilization at only 15.8%, indicating potential inefficiencies in production capacity [9][11] Strategic Direction - The company's core strategic focus includes capacity restructuring, channel expansion into county-level maternal and infant stores, and brand upgrading, with plans to allocate 50% of IPO proceeds to brand building and 30% to expand production capacity [12][13] - The company aims to increase its female care business revenue to RMB 500 million within three years, while also addressing the underutilization of its adult product lines [12][13]

Core Viewpoint - Focus International Limited has submitted a listing application to the Hong Kong Stock Exchange, with Jianquan Financing Limited as its sole sponsor [1] Business Overview - Focus International primarily engages in the manufacturing and sales of absorbent hygiene products, which are categorized into three types: baby care products, feminine care products, and adult incontinence products. The company also sells materials for hygiene products [4] - The company employs a multi-brand strategy to offer a wide range of absorbent hygiene products mainly in China, with brands including "Cotton Hour Light," "Focus Baby," and "Baimule" for baby care, and "Weiyue" and "Blue Cotton Flower" for feminine care [4] Operational Segments - The business operates in three segments: 1. **OEM Business**: Provides manufacturing services for both Chinese and international brand owners, with revenue increasing from RMB 64 million in FY2022 to RMB 108 million in FY2024, accounting for 24.1% of total revenue in FY2024 [5] 2. **Brand Products Business**: Focuses on the research, production, and sales of proprietary absorbent hygiene products in China, with revenue rising from RMB 13.5 million in FY2022 to RMB 160 million in FY2024, representing 35.8% of total revenue in FY2024 [5] 3. **Hygiene Product Materials Business**: Involves sourcing raw materials and processing them into standardized materials like SAP, hot melt adhesive, and non-woven fabric, with revenue increasing from RMB 104 million in FY2022 to RMB 179 million in FY2024, making up 40.1% of total revenue in FY2024 [5] Client and Production Capacity - The company's top five clients accounted for approximately 44.4%, 36.3%, and 39.9% of total revenue during the reporting periods, with the largest client contributing about 16.2%, 13.7%, and 13.1% respectively [6] - Focus International operates eight production lines in Quanzhou, Fujian Province, with a significant portion of the production process being automated [6] Financial Performance - The company reported total revenues of approximately RMB 181 million, RMB 372 million, and RMB 447 million for FY2022, FY2023, and FY2024 respectively, with net profits of RMB 12.3 million, RMB 39.5 million, and RMB 65.6 million during the same periods [8][9]