The Zhitong Finance App learned that Huatai Securities released a research report saying that the 24Q2 beauty care performance was differentiated. Among them, in terms of beauty brands, the share of leading domestic products increased, driven by big single products. During the 618 period, many companies such as Giazi Biotech had outstanding results. In terms of cosmetics ingredients, the overall price of traditional sunscreen varieties has dropped slightly, new sunscreen products are rapidly being launched, and care products such as anti-dandruff agents are gradually climbing. 24H1 is still resilient to growth. In terms of medical and aesthetic brands, the overall “price for quantity” penetration rate is still increasing. Differentiated varieties targeting the public are still being rapidly released, but terminal prices are under pressure and may be transmitted to the factory side. 24Q3 ushered in a low season in the industry, but it is also an important window for many brands to promote the new Double 11. It is recommended to actively monitor the development of new products.

The main views of Huatai Securities are as follows:

Beauty brands: the share of leading domestic products has increased, superior to the industry

From April to May '24, the cosmetics company had zero yoy -2.7%/18.7%. In May, there was a base effect brought about by the 618 front line and a long front line; in June, the cosmetics company had zero yoy -14.6%, which declined significantly. In April-June, Tmall Beauty's GMV was 60.664 billion yuan/yoy -2.85%. Under the platform's “focus on brand growth” strategy, there was a recovery from 24Q1; in April-June, Douyin Beauty's GMV was 47.79 billion yuan/yoy 21.78%, maintaining a relatively rapid growth rate but decelerating overall from 23 years. The boundary between shelf e-commerce and content e-commerce patterns on the two major platforms of Tmall and Douyin may also become more blurred, which may help leading brands increase their bargaining power. The overall strength of high-priced foreign brands is weak, and the share of high-quality domestic goods has increased, driven by large single products. Giant Biology/Pereyal/Shangmei Shares/Runben Co., Ltd. all had impressive results during the 618 period. It is expected that 24H1 revenue/profit will grow by more than 30% YoY, and the fundamental performance is even more prominent.

Beauty ingredients supplier: Q2 fundamentals have strong toughness

As for Sunscreen Ingredient supplier Covex Co., Ltd., it is expected that in 24Q2, shipments of old products will drop slightly month-on-month due to seasonal factors/order prices will drop slightly for individual varieties; new PS/EHT/PA/PM will continue to climb, and overall prices will maintain strong resilience; and the new anti-dandruff products will gradually rise from Q2. 24h1 revenue/net profit YoY is expected to be 21%/29%, respectively. 24H2 highlights: A new round of order signing for major customers is expected to be implemented, providing more clear guidance for growth in the second half of the year and next year; care products such as PO are gradually being released; more new products are being put into production at a clear pace, bringing new growth points.

Medical and aesthetic brands: New products perform more prominently

The penetration rate of medicine and beauty is still increasing, and the short to medium term is indeed more related to macroeconomic factors such as consumer expectations. The characteristics of the medical and aesthetic market since this year: 1) New supply has boosted consumer demand and downstream institutions more significantly, such as Weiyimei/regenerative injections, etc.; 2) Varieties with a relatively long life cycle are still being rapidly released, such as the Runzhi Doll Acupuncture/Hi Body series. It is expected that 24H1 medical and aesthetic leader iMeike Hi-Tei series revenue will continue to grow at a double-digit rate. Regenerative injections (Confucian+Resheng) are growing faster. Among them, 24Q2's revenue growth rate has slowed slightly due to last year's high base, and 24Q3 growth is expected to accelerate. In 24H2-25, the company's Bonida Second-Generation/Hi-Body New Indication Products/Botulism Products, etc. are expected to be approved, and the growth potential is worth looking forward to.

Medical and aesthetic service providers: steady health, anti-aging and rapid growth, medical beauty in exchange for price and quantity

For beautiful health service provider Mei Tianyuan, by business, it is estimated that: 1) Shengmei: Along with the increase in body products such as LPG (slimming health care program), 24H1 is expected to maintain steady growth at nearly double digits. 2) Anti-aging: Along with the increase in health awareness, 24H1 is expected to maintain a high double-digit growth rate and relatively rapid growth. 3) Medicine and aesthetics: The conversion rate is still increasing, but considering comprehensive factors such as the consumer environment and terminal product market competition, customer unit prices may be under phased pressure, and overall 24H1 revenue is expected to remain flat year over year. Considering that medical and aesthetic gross margins may also be under some pressure, profit margins are expected to drop slightly year over year.

Risk warning: Market competition intensifies; new product performance falls short of expectations; sales expenses increase.