HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Shanghai Chicmax Cosmetic / Equity Bottom-Up

<ul>
<li>Chicmax’s 2022 performance was ugly, which was mainly due to the weak sales growth in online channels. Without obvious improvement in sales channels, Chicmax would easily reach a growth bottleneck.</li>
<li>If Chicmax cannot transform from a marketing-driven low-end brand to a brand with growth potential that adheres to long-term principles,emphasizes equally on R&amp;D and marketing, it would lose investment value.</li>
<li>Chicmax is overvalued. Its valuation should be lower than that of Bloomage and Botanee. If things go badly in the future, its valuation could be lower than <a href="https://www.smartkarma.com/entities/shanghai-jahwa-united-co-a" target="_blank" data-smartkarma-citation="entities:4266:1" rel="noopener">Shanghai Jahwa</a>.</li>
</ul>


Chicmax’s 2022 performance was ugly, which was mainly due to the weak sales growth in online channels. Without obvious improvement in sales channels, Chicmax would easily reach a growth bottleneck.
If Chicmax cannot transform from a marketing-driven low-end brand to a brand with growth potential that adheres to long-term principles,emphasizes equally on R&amp;D and marketing, it would lose investment value.
Chicmax is overvalued. Its valuation should be lower than that of Bloomage and Botanee. If things go badly in the future, its valuation could be lower than Shanghai Jahwa.


Shanghai Chicmax Cosmetic (2145.HK) - Start to Enter a Vicious Cycle

<ul>
<li>Giant Biogene has been added to Hong Kong Stock Connect.There’s also positive sentiment driven by the consumption recovery after China reopens. But the Company is overvalued if compared with peers.</li>
<li>The subsequent product pipeline progress is relatively slow, with a gap of nearly two years in the middle. So, Giant Biogene's stock price performance may be relatively weak after 2024.</li>
<li>Due to various restrictions, the actual market space of collagen in the future may not be as large as expected. This is a point investors need to be aware of.</li>
</ul>


Giant Biogene has been added to Hong Kong Stock Connect.There’s also positive sentiment driven by the consumption recovery after China reopens. But the Company is overvalued if compared with peers.
The subsequent product pipeline progress is relatively slow, with a gap of nearly two years in the middle. So, Giant Biogene's stock price performance may be relatively weak after 2024.
Due to various restrictions, the actual market space of collagen in the future may not be as large as expected. This is a point investors need to be aware of.


Giant Biogene Holding (2367.HK) - The Situation May Not Be as Rosy as It Looks

Shanghai Haohai Biological Tec / Equity Bottom-Up

<ul>
<li>The General Office of the State Council issued favorable policy for TCM industry. However, TCM still has to face VBP, therefore <a href="https://www.smartkarma.com/entities/zhangzhou-pientzehuang-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:15709:1" rel="noopener">Zhangzhou Pientzehuang Pharmaceutical Co. (600436 CH)</a> and Gushengtang are our top picks..</li>
<li>Pfizer is in talks to acquire Seagen in a deal worth over US$30 billion, but we remain conservative about whether this transaction would ultimately bring expected contributions to Pfizer.</li>
<li>Haohai’s business model fails to bring ideal performance. Increasing competition/declining gross margin cast doubts on the outlook of medical aesthetics business. We’re not optimistic about its potential valuation upside.</li>
</ul>


The General Office of the State Council issued favorable policy for TCM industry. However, TCM still has to face VBP, therefore Zhangzhou Pientzehuang Pharmaceutical Co. (600436 CH) and Gushengtang are our top picks..
Pfizer is in talks to acquire Seagen in a deal worth over US$30 billion, but we remain conservative about whether this transaction would ultimately bring expected contributions to Pfizer.
Haohai’s business model fails to bring ideal performance. Increasing competition/declining gross margin cast doubts on the outlook of medical aesthetics business. We’re not optimistic about its potential valuation upside.


China Healthcare Weekly (March.3) - TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological

Shanghai Haohai Biological Technology / Equity Bottom-Up

<ul>
<li>Through continuous M&amp;A/resource integration, Haohai has gradually established its four business segments, but such development strategy hasn’t brought ideal performance, which is disappointing if compared with Bloomage and Imeik.</li>
<li>The future performance driver of Haohai still lies in the medical aesthetics business, but increasing competition and declining gross margin cast doubts on the outlook and growth potential.</li>
<li>
<a href="https://www.smartkarma.com/entities/shanghai-haohai-biological-technology-a" target="_blank" data-smartkarma-citation="entities:29220:1" rel="noopener">Shanghai Haohai Biological Technology-A (688366 CH) </a>is overvalued. Due to lack of growth point with high certainty, we are not optimistic about the upside potential of Haohai's valuation.</li>
</ul>


Through continuous M&amp;A/resource integration, Haohai has gradually established its four business segments, but such development strategy hasn’t brought ideal performance, which is disappointing if compared with Bloomage and Imeik.
The future performance driver of Haohai still lies in the medical aesthetics business, but increasing competition and declining gross margin cast doubts on the outlook and growth potential.

Shanghai Haohai Biological Technology-A (688366 CH) is overvalued. Due to lack of growth point with high certainty, we are not optimistic about the upside potential of Haohai's valuation.


Shanghai Haohai Biological Technology (688366.CH/6826.HK)- Disappointing Earnings and Gloomy Outlook

Equity Capital Markets

Beauty Farm Medical and Health Industry / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/beauty-farm-medical-and-health-industry-inc" target="_blank" data-smartkarma-citation="entities:35923:1" rel="noopener">Beauty Farm Medical and Health Industry (BFM HK)</a>’s solid growth has indicated that its business model works. But the industry tightening regulation and potential policy risk are our concerns.</li>
<li>As a downstream company in this industry, we are conservative about Beauty Farm’s profitability. Its profit space could be limited. The Company has weak bargaining power in the whole industrial chain.</li>
<li>Beauty Farm's performance could continue to be under pressure due to weak recovery of domestic demand after three years of the pandemic, especially those non-rigid consumption demand. </li>
</ul>



Beauty Farm Medical and Health Industry (BFM HK)’s solid growth has indicated that its business model works. But the industry tightening regulation and potential policy risk are our concerns.
As a downstream company in this industry, we are conservative about Beauty Farm’s profitability. Its profit space could be limited. The Company has weak bargaining power in the whole industrial chain.
Beauty Farm's performance could continue to be under pressure due to weak recovery of domestic demand after three years of the pandemic, especially those non-rigid consumption demand. 


Pre-IPO Beauty Farm Medical and Health Industry - Hard to Make Money Due to Industry Characteristics

China

Bloomage Biotechnology Corporation Limited develops and manufactures medical products. The Company produces fillers, mesotherapy products, bio reactive hyaluronic acids, repair soothing skin care products, and other products. Bloomage Biotechnology supplies its products in medicine, cosmetics, food manufacturing companies, medical institutions, and other fields.

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Bloomage Biotechnology Lt (688363 CH)

Shanghai Chicmax Cosmetic (2145.HK) - Start to Enter a Vicious Cycle

After Chicmax released the ugly 2022 results, it seems to have enter a vicious cycle. If Chicmax cannot transform into a visionary R&D driven...

Xinyao (Criss) Wang

Giant Biogene Holding (2367.HK) - The Situation May Not Be as Rosy as It Looks

After Giant Biogene has been added to Hong Kong Stock Connect, liquidity would improve a lot. But lower-than-expected market space, competition and...

Xinyao (Criss) Wang

China Healthcare Weekly (March.3) - TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological

New favorable policy for TCM industry was released. We analyzed our top picks. Pfizer is in talks to acquire Seagen, but we're conservative about...

Xinyao (Criss) Wang

Shanghai Haohai Biological Technology (688366.CH/6826.HK)- Disappointing Earnings and Gloomy Outlook

Continuous M&A fails to bring ideal performance to Haohai. Medical aesthetics is the main growth driver, but Haohai is lack of competitiveness....

Xinyao (Criss) Wang

Pre-IPO Beauty Farm Medical and Health Industry - Hard to Make Money Due to Industry Characteristics

As a downstream company, Beauty Farm has weak bargaining power in the whole industrial chain.We are conservative about its profitability. The...

Xinyao (Criss) Wang

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