Po Laiya (603605): Family-owned private enterprise cosmetics domestic classics
Cosmetics industry: (1) China’s cosmetics market leads the growth rate.
Cosmetics in China is a high-growth growth industry. From 2010 to 2018, the compound growth rate of the cosmetics industry reached 16%, which is significantly higher than that of other major cosmetics consumer countries.
(2) The cosmetics industry has obvious long tail effects.
Since 2008, Estee Lauder, L’Oreal, and Shiseido are all big bull stocks that are 10 times or more. In contrast, their performance has not shown a strong growth, and even some negative growth in fiscal years, but it is estimated to have reached more than 40 times.
The first is that these cosmetic giants have super stable cash flow and super stable ROE, and once the brand is established, it will produce obvious long tail effects.
The company’s core competitiveness: (1) It has “differentiated, younger” multi-brand assets.
The company covers brands such as Po Laiya, Youzilai, Han Ya, You Ya, Maoyu Rose, Yue Fu Ti, etc., and further deepens the “brand rejuvenation strategy”; (2) promote the “three carriages” strategy, multi-channel collaborative development model.
The company continues to implement refined management of offline traditional channels such as daily chemical franchise stores, department stores and supermarkets to further consolidate the company’s traditional advantages of offline channels. At the same time, it continues to develop e-commerce, single-brand store sales models, and implement multi-channel collaborative development.
Outstanding performance in 2018.
The company achieved revenue of 23 in 2018.
600 million, +32 per year.
4%, net profit attributable to mother 2.
900 million US dollars, + 43% per year, net profit after deduction is + 50% per year.
It is expected that the return to net profit of mothers will increase by 33% in 2019, which is estimated to be 34 times in 19 years.
Risk warning: industry competition or intensification; channel structure risk; new project incubation risk.