Core Insights - The company presented at the 2026 strategy meeting, focusing on the main brand Han Shu's category positioning, structural changes, and future expansion directions, along with updates on multiple brand incubations and overseas plans [1] Brand Performance - The main brand Han Shu continues to grow rapidly, with the GMV of the Hongbai Wan Yao product set optimized to below 50% in October, and the annual GMV proportion of secondary products nearing 15% [1] - The company is diversifying its product structure, with men's, personal care, body, and makeup categories accounting for approximately 20% of GMV [1] - Future expansions include new product series for the Hongbai Wan Yao set, continuous exploration of new ingredient additions for secondary products, and promising collaborations in the makeup category [1] Multi-Brand Development - New brands such as Newpage, Juguangbai, Anminyou, and Jifang show strong potential for growth, with Newpage achieving over 100 million GMV in October and aiming for 800-1,000 million for the full year [2] - Juguangbai reached around 30 million GMV in October and has achieved profitability, while Anminyou's GMV approached 40 million with significant profit margin improvements [2] - The company emphasizes maintaining profitability through refined operations and efficient investment flow [2] Organizational Efficiency - The company adopts a strategy of attracting top talent and building a strong organizational culture, which supports the incubation of differentiated multi-brands [3] - A robust self-broadcasting system has been established, with nearly 85% self-broadcasting ratio achieved in 2025, indicating high operational precision [3] - The company possesses a self-owned supply chain that is highly automated, cost-effective, and exhibits significant economies of scale [3] International Expansion - The company is steadily advancing its overseas strategy, with plans to enter the Indonesian market in 2026, leveraging local operations and the brand's competitive pricing and content marketing capabilities [3] - The new spokesperson Wang Jiaer is expected to enhance brand recognition in Southeast Asia [3] Financial Forecast and Valuation - The company maintains its net profit forecasts for 2025-2027 at 1.101 billion, 1.379 billion, and 1.717 billion respectively, with corresponding EPS of 2.77, 3.46, and 4.31 [4] - The company is assigned a target price of 121.67 yuan based on a 32x PE for 2026, reflecting the stable growth of the main brand and validated operational capabilities [4]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 121.67 [7]. Core Insights - The main brand, Han Shu, continues to grow rapidly, with the GMV of the Hongbai waist set products optimized to below 50% in October, and the annual GMV of the secondary products category nearing 15% [2]. - The company has a strong multi-brand potential, with significant growth expected from brands like Newpage, 聚光白, 安敏优, and 极方, contributing to overall revenue growth [3]. - The organization is efficient and flexible, with a robust online capability and a well-structured team that supports the continuous incubation of differentiated multi-brands [4]. - The overseas expansion is progressing steadily, with plans to enter the Indonesian market in 2026, leveraging local strategies and the brand's competitive advantages [4]. Summary by Sections Brand Performance - Han Shu maintains rapid growth, with a diversified product structure and significant contributions from various categories, including men's care and cosmetics [2]. - New product launches, such as the upgraded 白蛮腰 series, are anticipated to drive future growth [2]. Multi-Brand Development - Newpage achieved over HKD 100 million in GMV in October, with a target of HKD 800-1,000 million for 2025 [3]. - 聚光白 has shown profitability and potential in the whitening segment, while 安敏优 is experiencing accelerated growth post-adjustment [3]. Organizational Efficiency - The company emphasizes a strategy of attracting top talent and building a strong organizational culture, which supports its multi-brand strategy [4]. - The self-broadcasting system on platforms like Douyin has been established with a large team, achieving a self-broadcasting ratio of nearly 85% in 2025 [4]. Overseas Strategy - The company is preparing for its entry into the Southeast Asian market, particularly Indonesia, with a focus on localized operations and leveraging the brand's quality-price advantage [4]. Financial Forecast - The company forecasts net profits of RMB 1.101 billion, RMB 1.379 billion, and RMB 1.717 billion for 2025, 2026, and 2027 respectively, with corresponding EPS of RMB 2.77, RMB 3.46, and RMB 4.31 [5].