Sinolink: First-time coverage of CHICMAX (02145) with a "Buy" rating and a target price of 109.78 Hong Kong dollars.

Sinolink released a research report stating that CHICMAX (02145) is a leading enterprise in the beauty and skincare industry in China, with a multi-brand matrix in skincare, baby care, hair care, and other sectors. The company's main sales channel is online, and considering the strong growth potential of its multiple brands, both the future development of Hanshu and the cultivation of new brands have strong certainty. The company is valued at 30 times PE in 2025, with a target price of HK$109.78, and is covered for the first time with a "buy" rating. Sinolink's main points are as follows: Reviewing the company's development process, the bank believes that the company's multi-brand expansion methodology has several main similarities with the leading sports company ANTA SPORTS. 1) Market-driven approach. The company's brands are accurately positioned, allowing them to quickly identify consumer pain points, launch targeted products, and engage in bold marketing efforts while binding top IPs to help brands break through quickly. After the success of the main brand Hanshu, this methodology will be extended to other brands. 2) Trend towards fine-tuned channel operations. With content e-commerce becoming the core scene for cosmetic consumption, the company has restructured its channel strategy around Douyin, using innovative marketing strategies and increasing self-broadcast proportions for fine-tuned operations to achieve double growth in revenue and profit. 3) Internal and external talent cultivation. The company ensures the stability of core management talent through a dual-track approach of self-cultivation and external recruitment, while providing solid support for the differentiated development of its brands through proper talent appointment. The bank is optimistic about the company's establishment of a multi-brand group based on a mature brand operation methodology. The bank calculates the company's long-term growth space in the skincare, baby care, and hair care segments, expecting Hanshu to reach over 10 billion in 3 years, with rapid growth of multiple brands: Skincare business: In the past two years, Hanshu has exploded through the Douyin channel, significantly increasing its market share. In 2024, Hanshu's revenue is expected to grow by over 80%, with a slight decrease in revenue growth in 25H1 due to the contraction of the Daibo channel. However, Q3 online GMV remains strong, with Hanshu's GMV expected to increase by 50% in 2025 according to Jiujian data. Hanshu's mass and high-end product lines are progressing simultaneously, with revenue expected to surpass 10 billion in 3 years, and Yizhi's revenue expected to stabilize and accelerate. Baby care business: The Yizhi brand is in a high-growth phase with a unique "medical research and co-creation" model. The market share has rapidly increased in the past two years, and Yizhi has a competitive advantage with its high-end positioning and differentiated spokesperson. Compound growth is expected to exceed 50% in the next three years. Hongse Xiaoxiang is still adjusting after transitioning to the middle-to-large child market in 2023, and revenue growth is expected to first decrease and then increase. Hair care business: Expected to create a big brand. 1) There are many niche categories in the hair care sector, and brands that have a clear positioning and are skilled in building consumer mindshare can stand out. Companies such as Jifang and 2032 are expected to replicate the methodologies of brands like Hanshu and Yizhi. 2) The company entered faster-growing sectors such as efficacy and anti-hair loss, and the industry concentration is high, which helps in incubating big brands. Profit forecast valuation Online sales accounted for nearly 93% in 25H1, and in the past two years, the main brand Hanshu has leveraged Douyin channels to quickly break through. In 2024, revenue is expected to reach 5.591 billion, an increase of 80.90% year-on-year, accounting for over 82%. Revenue in 25H1 increased by 14.3% to 3.344 billion. New brands such as Yizhi are rapidly breaking through, with annual growth rates of 498%, 146%, and 147% in 2023/2024/25H1 respectively. The bank predicts that EPS for the company in 2025-2027 will be 2.68/3.33/4.09 yuan, with a valuation of 24 times in 2026. Risk warning Brand expansion may not meet expectations, marketing expenses may be higher compared to peers, and future performance growth may be unsustainable.