"Love Life, Love Lafang." Six Days Four Trading Counter Attack "Black Horse" Real Kinetic Energy?

"Love life, love Lafang."

With this slogan, Lafang Jiahua, once a household name, was established in 2001 from Shantou City, Guangdong Province. It is a local daily chemical company in China.

On March 13, 2017, Lafang Jiahua landed in the A-share market, known as "the first private daily chemical".

However, Lafang's overall net profit has declined for three consecutive years after its listing, which is "precisely related" to Lafang's brand reputation.

From 2017 to 2019, Lafang's net profit attributable to the parent company was 138 million yuan, 127 million yuan and 49 million yuan respectively, of which the decline in 2019 reached 60%.

Behind it, the diversified competition of the daily chemical industry racetrack once presented the Red Sea situation.

Until 2020, Lafang Jiahua will achieve a net profit of 117 million yuan, a year-on-year increase of 135.72%, which seems to have signs of recovery.

Few people would predict that this "no longer foreign" brand will become a "dark horse" in the A-share market.

On May 6, May 7, May 12, and may 13, 2021, Lafang Jiahua (603630. SH) closed four trading limits within six trading days. As of May 13, the share price of Lafang Jiahua reached 25.23 yuan / share.

What is the kinetic energy behind the data?

Medicare, e-commerce, and industrial fund restore Lafang's story from three perspectives. Can this old daily chemical giant tell a new story of transformation?

New national trend and medical beauty?

Lafang's popularity in the secondary market may bring a special sentiment to investors born in the 1960s and 1980s.

This brand once relied on the strong "shampoo" advertising campaign, and became a household name, but it was also unknown in the rapid market upgrading iteration.

According to the 21st Century Capital Research Institute, at present, Lafang Jiahua has its own brands such as "Lafang", "Yujie" and "meadows". In addition, Lafang Jiahua is the sole agent of overseas skin care brands "delpo" and "Rebecca". It also creates a new domestic brand "T8", a functional skin care brand "Ji ante", and integrates the color makeup brand "vnk", covering hair care, cleaning and bathing, etc Skin care, oral care, make-up and other categories.

In the first quarter of 2021, the revenue of Lafang Jiahua is 245 million yuan, with a year-on-year increase of 46.53%; The net profit attributable to the parent company was 16.7553 million yuan, with a year-on-year increase of 3.93%.

This seems to mean that lafanghua is going out of the quagmire of "year-on-year decline" in net profit.

What happened behind it?

After dismantling its annual report, the 21st Century Capital Research Institute learned that in 2020, the revenue of Lafang Jiahua was 984 million yuan, of which Lafang and MEDOS contributed 718 million yuan; Acting as "delpo" and "Rebecca", they contributed 14.2787 million yuan and 25.3698 million yuan respectively. Based on this, Lafang Jiahua's remaining revenue of 226 million yuan may come from Yujie, jianta, T8, vnk and other brands.

From the perspective of the time axis, starting from 2018, Lafang Jiahua has obtained the exclusive agency rights of several brands such as "delpo" and "Rebecca" in China, and began to achieve breakthroughs in the cosmetics market segment through the operation of agency brands.

In 2020, Lafang Jiahua hired Uzi, an E-sports player, to represent Yujie's chip pecking king. Yujie's products were introduced into traditional media such as Hunan Satellite TV's "youth in progress" and high-frequency launch of "Golden Eagle solo theater", Zhejiang satellite TV's "nianniannianniantaohuayuan" and "China blue theater".

All these show that lafanghua is striving to occupy the market of post-90s and post-00s.

When the market is more vertical, daily chemical products are no longer "a word of advertising go around the world.".

Perhaps it is only another key word "medical beauty" that drives the market trend of Lafang.

According to the reporter's analysis, Lafang Jiahua's "ji'ante" is positioned as a "professional skin care brand focusing on sensitive muscles". Lafang Jiahua and Guangdong Hansen Biotechnology Co., Ltd. jointly established Guangzhou ji'ante Biotechnology Co., Ltd., in which the company holds 51% of the shares. Relying on the background of ji'ante brand (mainly sold in medical and American channels), Lafang Jiahua has turned into skin care products for online C-end consumers, And for the online core post-95 consumer groups to carry out a comprehensive visual upgrade.

In 2020, jianta will launch 3 product lines of whitening, acne removing and repairing, with 13 new products in total. The key words are freeze-dried powder, astaxanthin and yeast moisturizing.

In addition, Lafang Jiahua's new Guochao brand "T8" is targeted at women aged 18-24 in generation Z, launching a series of new products such as "Cherry Blossom steam mask", "oil control shampoo" and "scrub cream".

Another layout action focuses on make-up. In 2020, Lafang Jiahua acquired the brand "vnk" by acquiring 51% equity of Shanghai Chengru e-commerce Co., Ltd., and further expanded its distribution in the field of cosmetics.

Despite the curiosity of the market, is lafanghua making strategic progress to medical and American?

However, in response to investors' questions in May this year, Lafang Jiahua stressed that "at present, jianta brand's skin care products for online C-end consumers have not cooperated with medical and American institutions for the time being.".

On April 23, it made another statement on the interactive platform, "at present, jianta brand products are mainly for online C-end consumers; A small number of offline products have been favored by some medical and aesthetic institutions ", which seems to be more meaningful.

online retailers?

What should be paid more attention to is the changes in the channel of lafanghua.

The changes in the composition of channel income can also show the change of the focus of lafanghua.

Lafangjiahua said that the offline channels are mainly through the mode of distributors, including supermarkets, cosmetics stores, boutiques, etc; Online channels are mainly operated through direct marketing, distribution and consignment mode, including mainstream platforms such as tmall, Taobao, Jingdong and shuoyin; In addition, through beauty fashion talent and opinion leaders, the products are displayed by live broadcast, short video, pictures and so on.

According to the classification of annual report disclosure channels, it can be divided into three categories: distribution channel, supermarket channel and e-commerce and retail channel.

In 2017, Lafang Jiahua began to adjust and optimize the distribution of sales channels, focusing on expanding new channels such as modern channels (such as hypermarkets, supermarkets, small supermarkets, etc.), cosmetics stores and e-commerce (such as Jingdong, tmall, etc.).

At the same time, through the construction and upgrading of distribution channel stores, the company accelerates the construction of online and offline collaborative marketing system.

In 2018, Lafang Jiahua was still emphasizing Ka channels represented by "RT Mart" and "Wumei", with revenue of 281 million yuan, accounting for 29.17% of revenue. However, it was also mentioned that "the company is vigorously developing online channels.".

By 2019, lafangka will obviously shift its focus to e-commerce and retail channels, which is expressed as "the company has achieved certain results in channel strategy adjustment".

The 21st Century Capital Research Institute finds that under this background, the composition of its channel income has changed significantly: from 2018 to 2020, Lafang Jiahua's traditional "distribution channel" achieved revenue of 577 million yuan, 592.5 million yuan and 593.3 million yuan respectively, accounting for a slight increase from 59.85% to 60.29%, still occupying the majority.

In the same period, its "supermarket channel" achieved revenue of 281 million yuan, 248 million yuan and 167 million yuan respectively, with a year-on-year decrease of 32.86% in 2020, with a significant decline.

In contrast, "e-commerce and retail channels" have become the "dark horse" of lafanghua's channel anti surpassing in recent years.

From 2018 to 2020, the revenue of "e-commerce and retail channels" will be 106 million yuan, 124 million yuan and 222 million yuan respectively, accounting for 12.82% of the total revenue from 11.00%, and then to 22.60% all the way, with a year-on-year increase of 79.91% in 2020.

By the end of the first quarter of 2021, lafanghua's "e-commerce and retail channels" achieved revenue of 71.4374 million yuan, accounting for 29.15% from 22.60% in 2020, with a year-on-year increase of 176.63%.

What can not be ignored is that lafanghua's "channel strategic adjustment" is also facing pains and challenges.

In 2019, Lafang Jiahua not only optimized and adjusted its sales channels, but also focused on supporting high-quality distributors; In addition, it has increased the size of new retail, and expanded a variety of marketing channels, such as live delivery with goods, social e-commerce, and shopping; At the same time, its acting brand of "Rebecca" entered the "Sephora" channel and opened tmall global stores“ "Delpo" brand opened tmall global stores, which were put on the Taiwan market, and entered into the "Wanning" and "Watsons" sales channels in Hong Kong.

But it still can't withstand the decline in 2019.

Lafang Jiahua admitted in the performance express that the company's sales channels are mainly the traditional channels of offline distributors. In 2019, the company will face fierce market competition and fierce impact of online competitive products.

In 2020, lafangjiahua still insists on "channel adjustment and optimization" and adds "e-commerce and retail channels".

Various marketing channels, such as live delivery with goods, social e-commerce, and social platforms such as Shuo Yin, xiaohongshu, station B, Kuaishou and video number have gradually brought about significant increment.

For example, the layout of the cosmetics brand "vnk", the product "fangtang lipstick" cooperated with Li Jiaqi, and signed the first lip star spokesperson Hu Chunyang, and carried out promotion and publicity through full matrix layout such as social platform, xiaohongshu, shuoyin, etc., and full cooperation in live broadcast.

Whether this is a steady profit business, at present, it seems that it is still in the shuffle period.

Industry fund?

There are signs of ambition in Lafang's domestication, which started with washing and protecting products.

However, it seems that it has not taken a detour in industrial M & a relying on capital market tools.

As early as in the annual report of 2018, Lafang Jiahua said that it was actively looking for high-quality projects in the fields of cosmetics and skin care products with the help of industrial funds, and it could not exclude the distribution of cosmetics and skin care products and other subdivision fields by means of acquisition and equity participation.

As early as the end of March 2017, Lafang Jiahua injected tens of millions of yuan into xiaomeichengpin, a B2B purchasing platform for imported products.

In September of the same year, Lafang Jiahua purchased 20% equity of Suqian Baibao Information Technology Co., Ltd. (hereinafter referred to as "Suqian Baibao") with a price of 109.5 million yuan. Suqian Baibao mainly operates maternal and infant and pan female we media community and e-commerce business.

In the same year, Lafang Jiahua planned to spend 808 million yuan in cash to acquire 51% of the equity of Shanghai Jinjia International Trade Co., Ltd., an overseas cosmetics brand operation agency.

Due to high premium, high performance commitment and other doubts, the capital operation was finally terminated.

In April 2019, the chairman and general manager of Lafang Jiahua, Mr. Wu guiqian, the chief financial officer, and Zhang Chen, the Secretary of the board of directors, received a regulatory warning letter.

In addition, in April 2018, Lafang Jiahua, together with Zhuhai Huaxi Fund Management Co., Ltd. and Deng min, the actual controller of Pinguan technology, jointly initiated the establishment of Zhuhai Lafang Pinguan Huaxi Investment Fund partnership (limited partnership), with a total fund size of 100 million yuan and an initial scale of 50 million yuan. As one of the limited partners of the industrial fund, the company made the initial subscription of 47 million yuan.

Lafang Jiahua said that the partnership mainly invests in the beauty industry channel providers, agents, service solution providers, domestic and foreign high-quality cosmetics brand companies and other industrial chain projects related to the company's main business.

Lafang Jiahua said that the partnership mainly invests in the beauty industry channel providers, agents, service solution providers, domestic and foreign high-quality cosmetics brand companies and other industrial chain projects related to the company's main business.

According to the annual report of Lafang Jiahua in 2020, during the reporting period, Lafang Jiahua held 96.9879% shares in the partnership of Zhuhai Lafang Pinguan Huaxi Investment Fund, with an operating income of 0 yuan and a net profit of 18.6398 million yuan.

As of the end of December 2020, the fund still has 6 investment projects, with a total investment amount of 49.364 million yuan, including Shenzhen Qianhai Xiangxiang Technology Co., Ltd., a "digital marketing solution provider", with an investment amount of 14 million yuan, and Wuxi dikesi Biotechnology Co., Ltd., which operates the baby care brand "daikesi", with an investment amount of 13.064 million yuan.

In May 2018, Lafang Jiahua also purchased 26.80% of the equity of Guangzhou Mizui Information Technology Co., Ltd. with a cash of 34.4 million yuan. Its main business is the operation of original content of we media and the management and operation of its own color brand "meetday".

According to the announcement, we media operated by Guangzhou honey cosmetics are mainly wechat public accounts and micro blog "MK cool", and have wechat public accounts such as "Rhapsody of little may", "pink star grass chicken", "girl Zhang orange holding gills" and "MK's small universe". In addition, the company has "meetday" beauty brand, the product category mainly includes color make-up and beauty tools, which are mainly sold on Taobao platform.

In addition, Lafang Jiahua also participated in another industrial fund, Zhuhai Lafang e-jane new media industry fund (limited partnership), with a shareholding of 99.99%. During the reporting period of 2020, Lafang Jiahua completed an operating income of 0 yuan and realized a net profit of - 3.9756 million yuan.

As of the end of December 2020, Zhuhai Lafang e-jane new media industry fund (limited partnership) still has 8 investment projects, with a total investment amount of 67.7325 million yuan.

The investment projects include Hangzhou huaixiubang cultural and creative Co., Ltd., which produces creative characteristic audio and video on the new media platform in the way of similar original sound dubbing, with an investment amount of 5 million yuan, and the omni channel e-commerce operation of nesheng Technology (Guangzhou) Co., Ltd., with an investment amount of 9.7325 million yuan.

variable

If only from the perspective of diversified layout and channel optimization, Lafang does not have a strong A-share hot spot.

In the development strategic plan of 2021, the goal is: relying on the four key strategic plans of "matrix", "Youth", "international" and "optimization", strive to become an international competitive personal care company integrating product R & D, brand operation and full link channel.

In the special period of product matrix expansion and sales channel transformation, how to create a new brand with high reputation and sales volume is still a big challenge for Lafang Jiahua.

For example, Guangzhou ji'ante Biotechnology Co., Ltd., a skincare brand relying on medical and American channels to transform online C-end consumers, has achieved a revenue of 2.6046 million yuan as of December 31, 2020, but has not yet achieved profit, with a net profit of 3.397 million yuan.

In addition, there is still a gap between the sales volume of popular items and the number of fans of "vnk", which is a brand with expanded layout of Lafang Jiahua, compared with the domestic cosmetics brands such as perfect diary and huaxizi.

On May 13, the 21st Century Capital Research Institute inquired about vnk tmall flagship store, and found that the number of fans was 2.53 million, and the best selling product was vnk Art Museum lipstick, with monthly sales of 10000 +, ranking the first among the best-selling lipsticks and lipsticks in the store; In addition, the monthly sales volume of vnk sugar lipstick is 3000 +.

In contrast, the perfect diary tmall flagship store has 16.99 million fans. The best seller is a small slim lipstick with 160000 monthly sales and another business card Lip Glaze with a monthly sales volume of 140000.

In addition, huaxizi tmall flagship store has 9.88 million fans. The best seller is an air honey powder with a monthly sales of 420000. In addition, another carved lipstick has a monthly sales volume of 52000.

Shanghai Chengru e-commerce Co., Ltd. behind the brand of "vnk" cosmetics, has achieved an operating income of 23.7399 million yuan and a net profit of 6.5822 million yuan in the reporting period of 2020.

On May 13, an analyst from the daily chemical industry pointed out to the 21st century capital research institute that "the competition in the color cosmetics industry is fierce. In recent years, many local skin care and beauty companies have made progress in quality, research and development and packaging. However, there are bottlenecks such as single brand and single SKU product form. High end and functionalization are still the trend. How to maintain new brands is a fine work.".

Zheshang Securities pointed out in the research paper in November 2020 that Lafang Jiahua "new and sharp brands contribute to the high growth of e-commerce Q3", but it also mentioned that the potential risks are "the new brand development is not as expected and the e-commerce development is not as expected".

In addition, one of the sales companies of Lafang Jiahua, a wholly-owned subsidiary, Dewei (Shanghai) Cosmetics Co., Ltd., is still at a loss.

In 2018, Dewey (Shanghai) achieved a revenue of 14.3268 million yuan and a net profit of 1.324 million yuan. In 2019, the revenue will be 45.5442 million yuan, and the net profit will be 20.445 million yuan. In 2020, the revenue will increase to 55.2058 million yuan, and the net profit loss will narrow to 15.4639 million yuan.

On May 14, Lafang Jiahua Securities Affairs Department said that "all information is subject to the announcement" in the business form of Dewei (Shanghai).

Although several trading limits have been closed recently, compared with the high price of Lafang Jiahua after its listing in March 2017 of 55.33 yuan, the closing price of 25.23 yuan on May 13 can only be regarded as moderate.

From January 2019 to January 2021, its stock price has been floating in the range of 10-15 yuan.

Judging from the dragon and tiger list of Lafang Jiahua on May 13, Niu sanzhang's commonly used seat in Jianping, Guoyuan securities bought more than 60 million yuan in Shanghai Hongqiao Road business department, which was located in buying a seat; The hot money also appeared Guosheng securities Ningbo Sangtian Road business department, which bought more than 20 million yuan and was located in buying four seats; At the same time, more than 24 million yuan has been bought for one institution's exclusive seat, and four seats have been purchased.

Among the sold seats, CICC Shanghai Huangpu District Hubin Road Securities Business Department, Huatai Securities headquarters and Shengang securities Sichuan Branch sold more than 26 million yuan, 18 million yuan and 23 million yuan respectively, selling one, two and three seats respectively.

There are also institutional analysis that Lafang Jiahua has been trading repeatedly recently, which does not rule out fund speculation in the second tire plate“ Suqian Baibao, previously invested by Lafang Jiahua, mainly operates mother infant and pan female we media community and e-commerce business, with relevant concepts. "