The beauty care sector has obvious relative benefits. This week, the beauty care (Shenwan) index fell 0.9%, the Shanghai index fell 3.9%, the Shenzhen Component Index fell 5.1% and the Hang Seng Index fell 4.1%. The subject matter with obvious relative return and absolute return in the near future has two characteristics: 1) in the long run: the real core high-quality leader with deep adjustment in the early stage, looking for opportunities for value investment at the bottom; 2) In the short term: the market has greatly improved its requirements for performance certainty, and requires fast rebound speed and strong rebound certainty after the epidemic.
Long term logic: callback 40%, valuation bottom in recent 1-2 years, investment logic has not changed significantly. Good industry, high growth and low penetration track; Good companies, leading companies have strong certainty and growth, light medical beauty: according to Sullivan, in the past five years, CAGR 25%, penetration rate of 3.6%, less than 1 / 3 of Japan, the requirements for R & D + qualification barriers are very high, CR7 city accounts for more than 90%, and the leading market accounts for more than 20%. Functional skin care: according to Euromonitor, in the past five years, CAGR 28%, penetration rate of 7% is about 1 / 3 of developed countries, and the requirements for R & D + marketing endorsement barriers are high, CR10 city accounts for 80%, and the leading city accounts for 20% – 30%.
Short term logic: the market focuses on the rebound speed and ability after the epidemic. The performance of beauty care has good toughness, fast rebound speed and strong certainty
Light medical beauty: 1) early rebound time and fast rebound speed. After the epidemic situation was gradually unsealed, Yimei hospital resumed business and prepared goods in advance to meet the recovery of the industry. Therefore, the upstream suppliers of Yimei represented by Imeik Technology Development Co.Ltd(300896) , Huaxi, will rebound in performance as soon as possible. 2) Strong certainty: on the one hand, the re purchase rate of light medical beauty is high, the consumption viscosity is strong, and the medical beauty hospital organizes a large number of group purchase preferential activities during the epidemic period, so it is judged that the medical beauty consumption will rebound rapidly; In addition, the medical and American consumption upgrading track is usually for middle and high consumption groups with stable income, and the consumption power is more guaranteed.
Cosmetics: 1) high proportion of e-commerce: for domestic brands such as Winona and Proya Cosmetics Co.Ltd(603605) , about 80% of their income comes from online channels, which is less impacted than physical consumption; 2) The peak consumption season is relatively concentrated: consumers usually store cosmetics in a big way. They see section 3.8 in the first quarter and 618 in the second quarter. This round of epidemic control began at the end of March, when the 3.8 promotion had ended, so it had limited impact on the performance of the first quarter; The performance in the second quarter mainly depends on 618. At that time, logistics is expected to recover in an all-round way, and the performance in the second quarter is relatively guaranteed.
The medical beauty cosmetics sector is a sector with deep adjustment in the early stage, excellent leading fundamentals and strong certainty of rebound after the epidemic. Recommended targets include Imeik Technology Development Co.Ltd(300896) , Yunnan Botanee Bio-Technology Group Co.Ltd(300957) , Bloomage Biotechnology Corporation Limited(688363) , Proya Cosmetics Co.Ltd(603605) , Lushang Health Industry Development Co.Ltd(600223) , etc.
