Founder and Strategist, Entext Economics & Strategy

Sean Maher

Founder and Strategist

Entext Economics & Strategy

Entext provides institutional investors with distinctive, actionable asset allocation and thematic research, which typically challenges the market consensus. Our clients range from credit, equity and multi-asset hedge and pension funds to family offices and sovereign funds. 
 
We focus on identifying key inflection points in macro data and relative asset performance amid the 'groupthink'  and confirmation bias that characterizes most investment bank analysis.

Macro Driven Investment Insight

Thematic (Sector/Industry)

<div style="text-align: left;" class="content-caption"><blockquote><p><em>‘“I try to use a facial pack every night,” says Mr. Kim, 28 years old, who now works at an office in Seoul. “It’s been a daily routine since my time in the military.” South Korea is a force in the global beauty industry and its carefully groomed pop idols have become global stars. And for many guys here, the gateway to face serums and 10 step skin care regimens is their time as military conscripts. During his service, Mr. Kim developed a routine while posted at an observation post along the barbed wire fences of the inter-Korean demilitarized zone.’ </em></p></blockquote></div><div class="content-remarks"><p><a href="https://www.wsj.com/articles/the-secret-to-surviving-military-service-moisturizer-foam-cleanser-cucumber-face-mask-1535034194" target="_blank">WSJ article</a> on the elaborate skincare rituals of S. Korean men</p></div><blockquote>
<em>“Fiscal year 2018 was an outstanding year for our company. By focusing on strategic priorities and investing in our multiple engines of growth, we delivered double-digit sales and earnings per share gains in all four quarters. In constant currency full year sales rose 13%, nearly twice the rate of global prestige beauty and diluted EPS increased 24%. What made our performance particularly strong were our over achievements in Asia and in Skin Care globally. </em><em>” </em>
</blockquote><div class="content-remarks"><p>Fabrizio Freda, CEO Estee Lauder</p></div><div class="content-remarks">
<blockquote><p><em>‘But the market and gender norms are changing, with cosmetics no longer seen as exclusively for women and male celebrities showing that it is OK for men to dab on a bit of blush. Jiang says a firm that manages bloggers pays him about 5,000 yuan (US$730) per month to feature products from cosmetics companies. Increasingly, foreign firms like La Mer and Aesop work with video bloggers such as Lan Haoyi, to promote their products to his nearly 1.4 million followers.</em>’</p></blockquote>
<p>From a recent SCMP article</p>
</div>

‘“I try to use a facial pack every night,” says Mr. Kim, 28 years old, who now works at an office in Seoul. “It’s been a daily routine since my time in the military.” South Korea is a force in the global beauty industry and its carefully groomed pop idols have become global stars. And for many guys here, the gateway to face serums and 10 step skin care regimens is their time as military conscripts. During his service, Mr. Kim developed a routine while posted at an observation post along the barbed wire fences of the inter-Korean demilitarized zone.’ WSJ article on the elaborate skincare rituals of S. Korean men
“Fiscal year 2018 was an outstanding year for our company. By focusing on strategic priorities and investing in our multiple engines of growth, we delivered double-digit sales and earnings per share gains in all four quarters. In constant currency full year sales rose 13%, nearly twice the rate of global prestige beauty and diluted EPS increased 24%. What made our performance particularly strong were our over achievements in Asia and in Skin Care globally. ” 
Fabrizio Freda, CEO Estee Lauder
‘But the market and gender norms are changing, with cosmetics no longer seen as exclusively for women and male celebrities showing that it is OK for men to dab on a bit of blush. Jiang says a firm that manages bloggers pays him about 5,000 yuan (US$730) per month to feature products from cosmetics companies. Increasingly, foreign firms like La Mer and Aesop work with video bloggers such as Lan Haoyi, to promote their products to his nearly 1.4 million followers.’
From a recent SCMP article


Korean Men Leading Next Asian Skincare Boom

Making sense of the Global Market, Euromonitor International Ltd.

Yu Mitsuhashi

Making sense of the Global Market

Euromonitor International Ltd.

We are a global market research company focused on industries, countries, economies and consumers worldwide. Our cross-country comparable research helps your organisation identify opportunities and develop growth strategies in countries and regions across the globe. With offices around the world, 1,200 analysts in 100 countries and market research on every key trend and driver, we give you powerful access to the real story behind consumer change.

<ul><li>Colour cosmetics recorded current value growth of 21% to reach CNY34.4 billion in 2017.</li><li>Limited edition or high-tech colour cosmetics enticed consumers in 2017.</li><li>Unit price showed an upward trend in 2017 - thanks to premiumisation trend.</li><li>L’Oréal China was the clear leader with a value share of 28% in 2017.</li><li>Value sales of colour cosmetics are expected to record a CAGR of 11% at constant 2017 prices over the forecast period to reach CNY57.0 billion in 2022.</li></ul>

Colour cosmetics recorded current value growth of 21% to reach CNY34.4 billion in 2017.Limited edition or high-tech colour cosmetics enticed consumers in 2017.Unit price showed an upward trend in 2017 - thanks to premiumisation trend.L’Oréal China was the clear leader with a value share of 28% in 2017.Value sales of colour cosmetics are expected to record a CAGR of 11% at constant 2017 prices over the forecast period to reach CNY57.0 billion in 2022.

Sector Capsule: Colour Cosmetics in China

<ul><li>Premium beauty and personal care grew by 25% in current value terms to reach CNY84.5 billion in 2017.</li><li>Premium outperformed mass beauty and personal care in 2017, thanks to stronger consumer purchasing power.</li><li>Accelerated value growth is underpinned by consumers trading up to quality products in 2017.</li><li>L’Oréal China consolidated its leadership in 2017.</li><li>Premium beauty and personal care is expected to record a CAGR of 11% at constant 2017 prices to reach CNY143.9 billion in 2022.</li></ul>

Premium beauty and personal care grew by 25% in current value terms to reach CNY84.5 billion in 2017.Premium outperformed mass beauty and personal care in 2017, thanks to stronger consumer purchasing power.Accelerated value growth is underpinned by consumers trading up to quality products in 2017.L’Oréal China consolidated its leadership in 2017.Premium beauty and personal care is expected to record a CAGR of 11% at constant 2017 prices to reach CNY143.9 billion in 2022.

Sector Capsule: Premium Beauty and Personal Care in China

Macroeconomics

<ul class=""><li>Asia will remain the key driver for consumer industries, however the region’s significance varies by industry. Consumer electronics and personal accessories will see close to 100% of absolute value growth coming from the region, while some of the more saturated industries such as tobacco, soft and hot drinks will see 20-40% of growth coming from Asia. In between, there are industries such as beauty, apparel and packaged food, all of which will derive around 50% of future growth from Asia.</li><li>Asia Pacific will account for 30% of global packaged food value by 2022 thanks to above 20% absolute growth in key categories such as baked goods, edible oils and dairy. This rapid growth offers significant opportunities for packaged food players, as levels of consumption for many categories are still far below Western standards.</li><li>52% of global market growth of packaged food is expected to stem from Asia Pacific by 2022. Breakfast cereals, edible oils and baby food will be especially lucrative as more than 70% of global growth will come from Asia Pacific.</li><li>Indonesia is among the top five fastest growing countries in Asia Pacific for value sales of dairy, and the country’s low per capita consumption of dairy also implies a huge untapped pool of consumers. As a result, this market has attracted numerous new entrants in recent years.</li></ul>

Asia will remain the key driver for consumer industries, however the region’s significance varies by industry. Consumer electronics and personal accessories will see close to 100% of absolute value growth coming from the region, while some of the more saturated industries such as tobacco, soft and hot drinks will see 20-40% of growth coming from Asia. In between, there are industries such as beauty, apparel and packaged food, all of which will derive around 50% of future growth from Asia.Asia Pacific will account for 30% of global packaged food value by 2022 thanks to above 20% absolute growth in key categories such as baked goods, edible oils and dairy. This rapid growth offers significant opportunities for packaged food players, as levels of consumption for many categories are still far below Western standards.52% of global market growth of packaged food is expected to stem from Asia Pacific by 2022. Breakfast cereals, edible oils and baby food will be especially lucrative as more than 70% of global growth will come from Asia Pacific.Indonesia is among the top five fastest growing countries in Asia Pacific for value sales of dairy, and the country’s low per capita consumption of dairy also implies a huge untapped pool of consumers. As a result, this market has attracted numerous new entrants in recent years.

Shifting Market Frontiers: Asian Century (Asian Century Across Industries - Part 4)

Investment Advisors, JL Warren Capital

Junheng Li

Investment Advisors

JL Warren Capital

JL Warren Capital LLC is a leading independent equity research firm focused on Chinese companies and listed multinationals in China. We employ a bottom-up research approach that takes great care to avoid the acquisition of material non-public information. Through investigative due diligence including channel surveys and interviews, our research helps clients to pinpoint the dislocations in the market.

<p>On December 19th, 4 vessels from the South Korea (SK) Coast Guard fired 200 plus live rounds over 44 Chinese fishing boats who were reported to be “swarming” a SK Coast Guard vessel in a ramming type maneuver.  The altercation arose due to the belief the Chinese fishing boats were (again) fishing in SK territorial waters.  Chinese authorities are extremely upset at the fact that South Korea fired upon un-armed Chinese fishing boats.</p><p>According to a <a href="https://www.toutiao.com/i6501583423499403789/?tt_from=weixin&amp;utm_campaign=client_share&amp;from=timeline&amp;app=news_article&amp;utm_source=weixin&amp;isappinstalled=0&amp;iid=19311607038&amp;utm_medium=toutiao_android&amp;wxshare_count=6&amp;pbid=49121877864" target="_blank">Toutiao news report,</a> only a few short hours after…</p>

On December 19th, 4 vessels from the South Korea (SK) Coast Guard fired 200 plus live rounds over 44 Chinese fishing boats who were reported to be “swarming” a SK Coast Guard vessel in a ramming type maneuver.  The altercation arose due to the belief the Chinese fishing boats were (again) fishing in SK territorial waters.  Chinese authorities are extremely upset at the fact that South Korea fired upon un-armed Chinese fishing boats.According to a Toutiao news report, only a few short hours after…

Renewed Chinese Tourism Sanctions on South Korea

South Korea

AMOREPACIFIC Holdings Corp. produces cosmetics. The Company manufactures skin care products, makeup, shampoo, and other products. AMOREPACIFIC Holdings conducts businesses in South Korea.

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Amorepacific Holdings (002790 KS)

Korean Men Leading Next Asian Skincare Boom

WSJ article on the elaborate skincare rituals of S. Korean men “Fiscal year 2018 was an outstanding year for our company. By focusing on strategic...

Sean Maher

Sector Capsule: Colour Cosmetics in China

Colour cosmetics recorded current value growth of 21% to reach CNY34.4 billion in 2017. Limited edition or high-tech colour cosmetics enticed...

Euromonitor International Ltd.

Sector Capsule: Premium Beauty and Personal Care in China

Premium beauty and personal care grew by 25% in current value terms to reach CNY84.5 billion in 2017. Premium outperformed mass beauty and...

Euromonitor International Ltd.

Shifting Market Frontiers: Asian Century (Asian Century Across Industries - Part 4)

Asia will remain the key driver for consumer industries, however the region’s significance varies by industry. Consumer electronics and personal...

Euromonitor International Ltd.

Renewed Chinese Tourism Sanctions on South Korea

On December 19th, 4 vessels from the South Korea (SK) Coast Guard fired 200 plus live rounds over 44 Chinese fishing boats who were reported to be...

JL Warren Capital

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