HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Yangtuo Technology Inc. / Equity Capital Markets

<ul>
<li>Yangtuo’s business model is B2B2C, targeting lower-tier market, but the consumption upgrade in lower-tier market lags behind, which will affect the sales of high-margin products and require more marketing/promotion investment.</li>
<li>Yangtuo decides to shift from digital marketplace business to self-operated business, but such strategic adjustments may force Yangtuo to abandon the light-asset model and turn to heavy-asset model.</li>
<li>Overall performance and key operating metrics have shown a downward trend. Continuous decline in profit margins is expected. Valuation of Yangtuo should be lower than <a href="https://www.smartkarma.com/entities/kidswant-children-products-co" target="_blank" data-smartkarma-citation="entities:34640:1" rel="noopener">Kidswant Children Products (301078 CH)</a>.</li>
</ul>


Yangtuo’s business model is B2B2C, targeting lower-tier market, but the consumption upgrade in lower-tier market lags behind, which will affect the sales of high-margin products and require more marketing/promotion investment.
Yangtuo decides to shift from digital marketplace business to self-operated business, but such strategic adjustments may force Yangtuo to abandon the light-asset model and turn to heavy-asset model.
Overall performance and key operating metrics have shown a downward trend. Continuous decline in profit margins is expected. Valuation of Yangtuo should be lower than Kidswant Children Products (301078 CH).


Pre-IPO Yangtuo Technology - The Business Model And Strategic Adjustments Will Not Work

China

Kidswant Children Products Co., Ltd. operates maternal and child product stores. The Company retails children clothes, toys, books, snacks, pregnant women clothes, and other goods. Kidswant Children Products also provides child care consultation services.

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Pre-IPO Yangtuo Technology - The Business Model And Strategic Adjustments Will Not Work

​Yangtuo faces challenges in lower-tier market consumption upgrade.Shifts to self-operated business may lead to heavier asset investment.Declining...

Xinyao (Criss) Wang

Yangtuo faces challenges in lower-tier market consumption upgrade.Shifts to self-operated business may lead to heavier asset investment.Declining...