Zhitong Financial APP learned that Bank of China Securities released a research report saying that due to the spread of the epidemic in December 2022, retail sales of consumer goods fell 1.8 per cent year-on-year, while cosmetics retail sales fell 19.3 per cent year-on-year. Online, the overall sales of cosmetics on the Amoy platform fluctuated in December 2022, the sales of major brands of key companies declined, and the performance of high-quality new brands was better.On the whole, the head brand has a strong long-term competitive advantage and is expected to achieve better growth in the context of the recovery of the retail environment after the epidemic.

Investment advice:As the platform traffic is limited and the overall growth rate of the industry slows down, the Matthew effect is becoming more and more prominent.Core recommendations:With product differentiation of dermatology grade skin care products race leader, product advantagesBettany (300957.SZ)(its brand Winona); focus on the large single product strategy, continue to expand the large single series horizontally and vertically, while constantly expanding new brandsPeraiya (603605.SH)Huaxi biology with the layout of the whole industry chain and multi-brand matrix; the layout of multi-brand full price segmentShanghai Jiahua (600315.SH)Own brand + agent brand two-wheel drive Aquarius shares. Suggested attention: multi-track layout, hyaluronic acid leader of differentiated brand matrixDevelopment of Shandong Merchants (600223.SH); ploughing recombinant collagen and functional skin care products, its Kefumei and other brands have significant advantagesGiant creatures (02367).

The main points of BOC Securities are as follows:

Affected by the spread of the epidemic in December 2022, retail sales of consumer goods fell 1.8% from the same period last year, and retail sales of cosmetics fell 19.3% from the same period last year.Consumer confidence was affected in December due to uncertainty about the spread of the epidemic, and the consumer goods market was under pressure. the total volume of consumer goods fell 1.8% in December from a year earlier, narrowing the month-on-month decline by 4.1% from November to 0.2% year-on-year in 2022. Cosmetics sales were greatly affected by the peak of the epidemic. Retail sales of cosmetics fell 19.3% in December compared with the same period last year (the decline was larger than that in November). As a typical optional consumption, cosmetics were highly related to terminal flow and travel activity, so the impact in December was greater than that in November. For the whole year, retail sales of cosmetics fell 4.5% from January to December compared with the same period last year. Although cosmetics retail is under short-term pressure affected by the epidemic in December, with the gradual improvement of the epidemic and the gradual effect of a series of policies to expand domestic demand, consumer demand will continue to be released, market sales are expected to recover steadily, and cosmetics retail sales are expected to stabilize growth in 2023.

In December 2022, the overall sales of cosmetics on the online Amoy platform fluctuated, the sales of major brands of key companies declined, and the performance of high-quality new brands was better.On the Taobian platform, GMV of most cosmetics companies has declined.Peraiya: the sales of the main brand Taobian fluctuated slightly, and the performance of the new brand was outstanding.Sales of the main brand Peraia Taobao fell slightly, while GMV of Amoy fell 6.37% in December. Consumer recognition of the new brand continues to improve, including Caitang outstanding performance, December Amoy Department GMV increased by 34.88%, Yuefu increased by 9.91%.Bettany: sales of major brands Taobao have declined.Its main brand Winona Amoy GMV fell 30.85 per cent year-on-year to 96.71 million yuan in December, while Winona BABY fell 15.91 per cent to 4.28 million yuan.Huaxi Biology: its main brand Taobian online retail pressure.The sales of Quadi / Mibel / muscle activating / moisturizing Baiyan fell 14.10% / 30.20% / 29.96% / 39.35% respectively in December compared with the same period last year.The development of Shandong merchants: the sales volume of the company's two major brands fluctuated in December.In December, Amoy sales fell 20.86% year-on-year to 48.84 million yuan, while Yilian fell 33.61% to 18.8 million yuan.Shanghai Jiahua: the sales of the main brand Amoy declined in December, and the outstanding performance was outstanding.Sales of Baicaoji, the main brand, fell 28.42% year-on-year to 20.3 million yuan in December. Sales of Dianjie's Amoy system increased by 168.51% in December compared with the same period last year. Sales of other brands have declined to varying degrees in the same period.Shuiyang shares: the main brand Taobian online retail pressure, new brands appear upward.Amoy sales of the main brand Yunifang fell 53.17% to 14.77 million yuan in December compared with the same period last year. The recognition of Shiyi family and big Waterdrop Inc. has improved, and the sales of Amoy system increased by 73.98% and 113.39% respectively in December.

Risk factors:New product expansion is not as expected; industry competition is intensified; policy risk; product safety risk.