Jinwoo Financial News | Minsheng Securities Research indicates that the Han Shu brand, a subsidiary of CHICMAX (02145), was born around 2000 and initially followed K-pop for brand promotion, such as signing Korean actress Choi Ji-woo as the brand ambassador and explaining the origin of the brand name as the Korean city “Sokcho”, etc., which quickly boosted brand awareness; at the same time, the brand had a keen insight into the potential opportunities of the third- and fourth-tier markets, and was able to gain a foothold in the domestic cosmetics market. Through the high exposure of TV programs, Han Shu reached more third- and fourth-tier consumers, and the brand's sales capacity was further improved. By 2011, nearly 50% of Han Shu's brand sales were contributed by TV shopping channels.
The bank pointed out that since 2020, the company has implemented a strategy of “fully embracing online channels”, set up social retail, social e-commerce, social live streaming, and new retail e-commerce departments, and dug deep into new traffic positions such as Douyin and Xiaohongshu to continuously improve online operation capabilities; after many trials and errors, the company chose to focus on boosting the Douyin channel and focus on resource cultivation cards, which are cost-effective, practical, and exquisite; in 2023, the Hongman Waistband Package took the lead in achieving a high increase in traffic dividends for Chinese and Douyin short dramas; Since then, the brand has continued to improve the broadcast and self-broadcast matrices, in line with Gao The store-style live broadcast of transactions has promoted the continued growth of Han Shu's brand potential and red waist gift box sales.
The bank said that through reviewing the company's development history of more than 20 years, the bank found that the company was able to keenly understand market changes and respond quickly at various periods, showing strong resilience even during relatively difficult adjustments. The bank believes that the company is a true enterprise with both offensive and defensive attributes and has the potential to become a cosmetics company with revenue of 10 billion dollars. The net profit to the mother is expected to be 0.9/1.16/1.37 billion yuan respectively. The closing price is 17/13/11X, maintaining the “recommended” rating.
