Investment Rating - The report maintains a positive outlook on the long-term growth potential of Hailan Home as it plans to list in Hong Kong, which is expected to enhance its overseas market presence and strengthen its competitive edge [1][12][13]. Core Insights - Hailan Home's overseas expansion strategy has been active since 2017, with a focus on Southeast Asia, and the company aims to continue exploring new markets and channels [12][13]. - The report highlights the successful registration of recombinant type III humanized collagen protein as a pharmaceutical excipient by Jinbo Bio, marking a significant breakthrough in the application of collagen in innovative drug development [14][17]. - The retail performance of the apparel sector showed a year-on-year growth of 3.7% in July, although the growth rate decreased compared to June due to various factors including promotional effects and extreme weather [23][32]. Summary by Sections Hailan Home's Hong Kong Listing - Hailan Home announced its intention to issue shares and list on the Hong Kong Stock Exchange, which is expected to facilitate its overseas market expansion and enhance its long-term competitiveness [1][12]. - The company has opened 111 overseas stores as of mid-2025, generating a revenue of 206 million yuan, a 27.42% increase year-on-year [12][13]. Jinbo Bio's Pharmaceutical Advancements - Jinbo Bio's recombinant type III humanized collagen protein has received approval as a pharmaceutical excipient, allowing it to be used in various drug delivery systems, enhancing drug efficacy while reducing side effects [14][15][17]. - The company is positioned to leverage its first-mover advantage in the domestic market for pharmaceutical excipients, with significant growth potential in the peptide and protein drug sectors [17][18]. Apparel and Cosmetics Market Trends - The apparel retail sector experienced a 3.7% year-on-year growth in July, with a noted decline in growth rate due to promotional effects and weather conditions impacting consumer traffic [23][32]. - The cosmetics retail sector saw a recovery with a 4.5% year-on-year increase in July, reflecting a positive trend in consumer spending [32]. Investment Recommendations - The report recommends Hailan Home for its strong brand and potential for growth in the apparel sector, alongside Jinbo Bio for its innovative products in the beauty and healthcare segments [35].

Industry Overview - In 2025, China's economy demonstrates strong resilience and vitality, with the clothing industry maintaining a stable and positive trend. The textile industry's added value increased by 3.1% year-on-year from January to June, while per capita clothing consumption rose by 2.1% [1] - Retail sales of clothing, shoes, and textiles increased by 3.1% year-on-year, and online retail sales of clothing grew by 1.4% [1] Company Performance - HLA Group Co., Ltd. reported a revenue of 11.566 billion yuan for the first half of 2025, a year-on-year increase of 1.73%. The net profit attributable to shareholders was 1.580 billion yuan, reflecting a decrease of 3.42% compared to the previous year [4][6] - The company’s total assets were approximately 33.422 billion yuan, with a slight decrease of 0.03% from the previous year [6] Strategic Initiatives - HLA has adopted a new strategic goal to become a world-class, leading Chinese brand in apparel retail, focusing on high-end, intelligent, and green technology upgrades [1][4] - The company is actively promoting health and sustainability, sponsoring various sports events and advocating for a healthy lifestyle [6] Brand Development - HLA's main brand achieved a revenue of 8.395 billion yuan, maintaining a market share of 5.0% in the men's clothing sector, which has been the highest in China for 11 consecutive years [7][9] - The company has launched new products focusing on functional technology and sustainable materials, with a research and development expenditure of 1.06 billion yuan in the first half of 2025 [9] Multi-Brand Strategy - HLA has expanded its brand portfolio to include various sub-brands and has established partnerships with global brands like Adidas, enhancing its market presence [10][16] - The company has also collaborated with JD.com to create a discount retail platform, improving consumer access to quality products [13] Financial Metrics - The gross profit margin for HLA's main brand reached 48.32%, with a steady increase in gross profit margins driven by the expansion of direct sales stores [18][19] - The company reported a significant increase in cash flow from operating activities, with a net cash flow of 2.718 billion yuan, up 36.11% year-on-year [6] Store Expansion - As of the report, HLA operates a total of 7,209 stores, with 1,532 being direct-operated stores, reflecting a net increase of 64 stores [21][22] - The company is focusing on expanding its presence in landmark commercial complexes to enhance customer experience [21] Future Outlook - Under the new strategic direction of "Focusing on Brands, Embracing the Global, and Enriching Lives," HLA aims to empower quality brands and connect China with the world [23]

Core Viewpoint - In the first quarter of 2025, Hailan Home demonstrated resilience in a competitive apparel industry, achieving a revenue of 6.187 billion yuan, a year-on-year increase of 0.16%, and a net profit of 935 million yuan, up 5.46%, marking a new high for the same period from 2020 to 2025 [1] Group 1: Brand Development and Market Position - Hailan Home has strengthened its brand operation, supply chain management, and channel operation capabilities, transitioning from a single national brand to a multi-brand apparel retail group, maintaining the leading position in men's clothing for 11 consecutive years [2] - The main brand "Hailan Home" generated revenue of 4.642 billion yuan in Q1 2025, accounting for 75% of total revenue, while the group also expanded its sub-brands and customized group purchase services [2] Group 2: Product Innovation and R&D - The company has increased its investment in product and technology fabric R&D, focusing on functional technology, smart living, fashion trends, and green environmental protection, with R&D expenses reaching 46.96 million yuan during the reporting period [3] - Hailan Home launched the "Far Travel Storm Jacket" aimed at outdoor activities, catering to the growing consumer demand for sports products [3] Group 3: International Expansion and Strategic Partnerships - Hailan Home is expanding its international presence, having entered markets in Southeast Asia and beyond, with plans to continue exploring the Middle East, Central Asia, and Australia [4] - The company has partnered with global brands, including exclusive agency agreements for the "Haid" brand in Greater China and collaborations with Adidas to enhance market penetration [4] Group 4: Digital Transformation and Retail Strategy - Hailan Home is actively pursuing digital transformation, integrating online and offline channels to enhance user experience and strengthen brand-consumer connections, resulting in a 19.76% year-on-year increase in online revenue to 1.014 billion yuan [6][7] - The company has implemented a smart retail ecosystem through the use of digital platforms, allowing for seamless online ordering and offline pickup, thereby improving shopping convenience [8] Group 5: Supply Chain and Operational Efficiency - Hailan Home has adopted RFID technology and established a smart logistics system, significantly improving operational efficiency and market responsiveness [9] - The company's logistics center has increased inventory capacity to 40 million items, achieving a sevenfold improvement in efficiency compared to before the upgrade [9] Group 6: Future Strategic Direction - Hailan Home has set a new strategic direction focusing on "focusing on brands, embracing the global market, and promoting inclusive living," aiming to empower quality brands and connect China with the world [11]