Market Review
Last week (02.28-03.06), the CSI 300 index fell 1.68%. According to the statistics of the key weight companies selected by us (listed in the 1.1 sector Market in detail), the beauty care industry portfolio fell 1.32%, of which the medical beauty / cosmetics / personal care products fell 2.34% / 1.01% / 0.60% respectively.
Since the beginning of the year, the CSI 300 index has fallen by 8.99%. According to the statistics of the key weight companies selected by us (listed in the market of 1.1 sector in detail), the beauty care industry portfolio has fallen by 13.71%, of which the medical beauty / cosmetics / personal care products have fallen by 16.40% / 13.38% / 11.36% respectively.
In terms of valuation, as of March 4, the price earnings ratio (TTM) of beauty care (801980. SI) was 48.24x, which was 41.75% in two years.
Core view
In the context of consumption upgrading and the prosperity of beauty culture, the leading brands of compliant medical and beauty medicine and cosmetics give priority to benefit and have good growth certainty. Entering the performance disclosure period, Yimei pharmaceutical machinery and brand cosmetics have performed well in the forecast. We believe that the current valuation of the sector is reasonable and continue to be optimistic about Imeik Technology Development Co.Ltd(300896) , Yunnan Botanee Bio-Technology Group Co.Ltd(300957) . It is recommended to pay attention to Furui medical technology, Bloomage Biotechnology Corporation Limited(688363) , Shanghai Haohai Biological Technology Co.Ltd(688366) , Proya Cosmetics Co.Ltd(603605) , Lushang Health Industry Development Co.Ltd(600223) , etc.
As of the latest trading day (March 4), the valuation of key targets:
1) Imeik Technology Development Co.Ltd(300896) : PE corresponding to 22-23 years is 69.51x/52.78x respectively;
2) Yunnan Botanee Bio-Technology Group Co.Ltd(300957) : the corresponding PE of 22-23 years is 62.27x/48.05x respectively.
Important industry trends and comments
The first administrative measures for monitoring adverse reactions of cosmetics in China was issued and will be officially implemented on October 1, 2022. Its promulgation further refined and improved the regulations on the supervision and administration of cosmetics and the measures for the supervision and administration of cosmetics production and operation on the monitoring of adverse reactions of cosmetics, systematically standardized the monitoring and management of adverse reactions of cosmetics, and Medical institutions and other entities have put forward specific requirements covering the whole process of adverse reaction monitoring, such as active collection, reporting, analysis and evaluation, self inspection and rectification, risk control, and compacted the main responsibilities of cosmetic registrants and recorders.
We believe that the introduction of the management measures marks a breakthrough in the safety supervision of China’s cosmetics industry. With the continuous improvement and implementation of systems and norms, the ability of cosmetics safety risk early warning and prevention and control is expected to be gradually improved, and the healthy development of industry standardization can be expected.
Announcement of key companies
In the annual performance forecast of chuang’er biology in 2021, the net profit decreased by 60-64% year-on-year Year on year decrease in net profit Yunnan Baiyao Group Co.Ltd(000538) 12 months ago, eight medical and aesthetic institutions were opened in Beijing and Shanghai Bloomage Biotechnology Corporation Limited(688363) its brand Wo launched new products with great weight; Furui Medical Technology launched a new personal care brand lmnt conceived by the group’s medical experts; The tmall Shopping Festival opens on March 8, 2022, Shanghai Lily&Beauty Cosmetics Co.Ltd(605136) helps Allie Ai Li sunscreen and Sophia makeup pre-sale; Sihuan pharmaceutical was included in the target of Hong Kong stock connect under Shanghai Hong Kong stock connect; Zhang Ziyi withdrew from the cosmetics company of Proya Cosmetics Co.Ltd(603605) company; Hengan international completed the issuance of 2 billion yuan of short-term financing bonds Proya Cosmetics Co.Ltd(603605) Hou Juncheng and other four persons completed a total reduction of 2035700 shares Winner Medical Co.Ltd(300888) as of the end of February, 4.7657 million shares had been repurchased Hangzhou Haoyue Personal Care Co.Ltd(605009) as of the end of February, the repurchase ratio reached 1.52%; The launch ceremony of the designated injection center for employees of United liger first hospital and Sinclair Xinkeli in the UK was successfully held.
Risk tips
Tip 1: risk of industrial policy change;
Tip 2: the terminal demand is less than expected.
