2022A&2023Q1, affected by epidemic situation, consumer psychology, traffic environment and other multiple factors, the sales of beauty cosmetics with optional & fast-disappearing properties are not ideal. The performance differentiation of listed companies has intensified; Online beauty products are shrinking and Tik Tok’s beauty products are increasing, but there is no obvious recovery offline. Looking forward to the second quarter, both the demand side and the supply side of beauty cosmetics are improving marginally, and the low base caused by the epidemic in the same period last year is superimposed, and the growth rate of the industry is expected to bottom out. However, due to the lack of driving force at the bottom, the recovery rate may be limited; Prefer stocks whose current growth can hedge the unfavorable factors of the industry.

▍ Performance is generally under pressure and differentiation is intensified.

1) Revenue & profit: the growth rate slows down, and the performance of high-quality leading players is tough. In 2022, the total operating income of six brand listed companies was 22.07 billion yuan/year-on-year+31.3%, with a growth rate of-16.7 pcts; Among them, the income growth rate of Polaiya (+37.8%/+14.3 pcts) and Juzi Bio (+52.3%/+21.9 pcts) increased against the trend.

2) In 2022, the total attributable net profit of six brand listed companies was 4.06 billion yuan/+11.0%, and the attributable net profit of Polaiya ranked first with a growth rate of 41.9%, and the profit growth rates of Huaxi Bio, Juzi Bio and Betani all exceeded 20%.

3) Gross profit margin: most of them declined, while Polaiya & Marumi rose against the trend, and the gross profit margin of Juzi Bio ranked first; The gross profit margin of Polaiya and Marumi shares was 69.7%/68.4% respectively, which was+3.2/+4.4 pcts year-on-year; Juzi Bio ranks first in the gross profit margin of all brand beauty listed companies with 84.4%.

4) Net interest rate attributable: most of them declined, while Polaiya rose against the trend. In 2022, the net interest rate of six brand listed companies increased by one and decreased by five; Among them, the net interest rate of Polaiya was 12.8%, which was +0.4pct year-on-year.

▍ Amoy’s beauty cosmetics contracted, Tik Tok’s beauty cosmetics increased, and the proportion of Tik Tok’s channels occupied online increased.

Industry perspective: 22 years of negative growth in Amoy beauty, 23Q1 decline narrowed; 22 years’ high growth of beauty in Tik Tok. 1) Amoy Department: According to the market intelligence data of Magic Mirror, the sales of beauty cosmetics of Amoy Department in 2022 was 280.6 billion yuan, with a year-on-year growth rate of-13.4% and-22.1 pcts; In 2023Q1, the sales volume of Amoy beauty cosmetics was 54.2 billion yuan, which was-12.7% year-on-year, and the growth rate was+1.6 pcts; 2) Tik Tok: According to the data of Mama Chan and Jumei, the sales of beauty cosmetics in Tik Tok in 2022 was 90.2 billion yuan, up+113.7% year-on-year; In Q1 of 2023, the sales of beauty cosmetics in Tik Tok reached 31 billion yuan, up+83.4% year-on-year, and the growth rate was +30.5pcts.

Corporate perspective: online revenue accounted for 57% ~ 91%, and the proportion of online channels in Tik Tok increased. In 2022, Polaiya Online accounted for 91%/+6pcts, of which Tik Tok accounted for about 15%+; Huaxi biological functional skin care products account for about 93%/+3 pcts online; Among them, Tik Tok accounts for about 31%/+14 pcts; Betaine online accounted for 81%/+1 pct, of which Tik Tok revenue accounted for 9%/+3 pcts; Giant biological line accounts for 57%/+15 pcts; Marubi shares accounted for 72%/+12 pcts online.

▍ Focus on creating classic big items and strengthening brand mind.

Local beauty companies actively increase their research and development, and empower them to create large items from many aspects such as raw materials and formulas.

Winona: Breaking the circle of "sensitivity+",consolidating the original superior items and creating a new generation of big items of the elite family;

Polaiya: The matrix of large single products has been initially built, and the strategy of large single products has been firmly implemented. New products such as Cloud Sun Protection and Double Anti-3.0 have been listed;

Run Baiyan: Brand mind is upgraded from basic moisturizing to technological repair, focusing on creating three series of barrier conditioning, light damage repair and time repair;

Quadi: Focus on eye cream and face cream to create an anti-aging mind. In April 2023, Quadi put on a new eye cream for young people (anti-eye cream);

Mibel: The main products are water and essence. In February, 2023, Mibel put on a new multi-vitality essence eye cream and a young age firming new muscle essence (3A purple essence).

Muscle activity: build large single products around brown rice series. According to the market information of magic mirror, in 2022, brown rice water single products accounted for 37.5%;

Marubi: continuously focus on eye and anti-aging products, mainly promoting the series of recombinant collagen and polypeptide red pens.

▍ New products have been put on record, and contents such as ingredient IP and "skin care formula" have been marketed.

According to the data of the State Food and Drug Administration, since the beginning of 2023, new products of local beauty listed companies have been put on record: 65 Marubi, 62 Polaiya, 55 Huaxi Bio, 38 shanghai jahwa, 20 Betani, 18 Giant Bio and 18 Lushang Development. The volume of recombinant collagen has increased, and Juzi and Marubi have launched high-potential new products with recombinant collagen peptide as the core component and increased their delivery to create explosions; The "skin care formula" extends from "early C late A" to "early P late R".

▍ Risk factors:

Post-epidemic recovery progress, insufficient willingness to consume, sustained recovery, etc. may have negative effects; Strict supervision or exceeding expectations; The progress of enterprise product development or approval may be less than expected, which will have a negative impact on performance.

▍ Investment strategy:

From the second quarter, both the demand side and the supply side of beauty cosmetics are expected to improve marginally. Adding to the low base caused by the epidemic in the same period last year, the growth rate of the industry is expected to bottom out. However, in view of the fact that the driving force of the industry has not changed substantially, the recovery rate may be limited. Judging from the third data such as magic mirror and mother, the growth rate of online beauty data in April has turned positive to a small positive growth; The situation of further recovery needs to be observed in the "618 Great Promotion" which started in late May. In terms of investment, there are many structural and individual opportunities.

Main line 1: Recommend companies that have outstanding comprehensive capabilities or are currently in the harvest period of change.

Main line 2: Recommend companies that adjust in stages, whose stock prices fully reflect the negative, and whose fundamentals are expected to improve marginally.

Main line 3: It is recommended to choose the right opportunity to lay out the air outlet track with outstanding technical advantages and good growth, but the stock price is affected by non-fundamental factors such as lifting the ban.

Main line 4: Recommend emerging sunscreen companies that are in the climbing cycle of capacity utilization rate, and actively expand into the field of personal care raw materials with broad growth space.

This article comes from a selection of brokerage research reports.

Because of the impact of epidemic and economic transformation, the population of third- and fourth -tier cities is flowing. Many of these migrant workers who returned from Shanghai, Shenzhen and other places are highly educated groups. In the golden area of ??third- and fourth -tier cities, they purchased houses in the "rich area", not only high -quality school district houses, but also supporting and greening are comparable to high -end houses in large cities. The houses in these high -end communities have risen first. Compared with other communities, the "hot island" effect appears, which is a lot higher than the surrounding house prices.

First, return home to snap up high -end houses

Many people who return home sell houses in big cities and buy a high -end house in their hometown. They can take their parents to live together. If you go back to the outside, you will have a place to settle in your hometown. Someone was affected by the mortgage of large cities. A loan of millions of dollars in a house made their lives and work suffer a lot of pressure. Buy a house in his hometown, and there are still funds in your hand to start a business or use it for daily life.

Second, the family replacement school house of the provident fund loan

Most families with provident fund loans are groups with stable income. Now many cities have increased the amount of provident fund loans and reduced down payment. They can buy a high -end house with a small amount of down payment. People who lived in the old town or high -rise houses were currently replacing high -quality school district houses. Therefore, high -end communities in third- and fourth -tier cities have recovered and rose against the trend, forming a sharp contrast with the surrounding second -hand housing.

Third, the scarcity of resources and the superiority of the location

Most of the "rich people areas" in third- and fourth -tier cities are mature communities built by large -scale housing companies that have been stationed before. From design style to supporting facilities are first -class. Now, many large real estate companies are far from the third and fourth -tier property market. It is difficult for local small development companies to have such a large handwriting, so it is particularly popular. The "rich area" is not only high in house prices, but also the local group is also rich or expensive in the local area. Therefore, house prices do not worry about selling the road.

From the trend of the property market this year, it can be seen that the rise and fall of the same city is blurred. So many favorable introduction, most of the property market is still not shocked. There are three changes:

01, the population continues to flow, but the house price is very strong

The phenomenon of the population of third- and fourth -tier cities is very common, and most of them are going out to make a living. If you say that Anjia Real Estate, you will choose to return to his hometown to buy a building. After all, house prices in large cities are high, living costs and housing costs are also high, and they can’t afford it. Therefore, many people will come to buy a neighborhood with good money outside. After all, Ye Luo will be rooted in the future, and now he will be filial to pick up his parents to life in the city.

02, interest rates have been reduced sharply, but most people do not buy a house anymore

Recently, with the introduction of the measures and interest rates, although the property market has stabilized and selling the building without panic, the transaction is still unconventional. Many third- and fourth -tier cities have no imagination scenes, and buyers are silent. Many families already have plans to buy a house, and the down payment can be available, but they are still watching and waiting. High -end communities are relatively hot, many people can’t afford it, housing prices in other areas are also falling, and few people buy it.

03, the vacancy rate increases, but the speculators do not throw the house

At present, the vacancy rate of third- and fourth -tier cities has increased by up to 30%. Many families have unstable income because of the high cost of housing. Therefore, when they return to the countryside, the house cannot be sold. There are also couples who work in the field. The speculators and groups of real estate have good housing in their hands, do not rent nor sold, and have no throwing house. Perhaps there are fantasies about the future property market.