External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

Yunnan Botanee Bio-Technology / Equity Bottom-Up

<ul><li>Botanee made a pronounced come-back year-to-date, reviving Tmall GMV from -59.8% YoY to -6.9% YoY between Jan and Oct, and accelerating its quarterly sales growth from 7% in 1Q to 26% in 3Q.</li><li>Year-to-date shares performance has gone against this trend and, in our view, the free-fall is running ahead of consensus estimates which still looked rather reserved in pricing-in the ongoing dilemma that Botanee is facing.</li><li>These are threefold: 1) when macro headwinds such as consumption trade-down (see our thematic report) and low fertility wish linger (see our Feihe downgrade report), growth outlook among AOXMED (super high-end) and Winona Baby could normalise sooner than expected, and Botanee’s single-brand risk could be exposed further given a full-fledged closequarters competition among brands; 2) herbal-/HA-based functional skincare is incrementally crowded out by the collagen-based. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Botanee made a pronounced come-back year-to-date, reviving Tmall GMV from -59.8% YoY to -6.9% YoY between Jan and Oct, and accelerating its quarterly sales growth from 7% in 1Q to 26% in 3Q.Year-to-date shares performance has gone against this trend and, in our view, the free-fall is running ahead of consensus estimates which still looked rather reserved in pricing-in the ongoing dilemma that Botanee is facing.These are threefold: 1) when macro headwinds such as consumption trade-down (see our thematic report) and low fertility wish linger (see our Feihe downgrade report), growth outlook among AOXMED (super high-end) and Winona Baby could normalise sooner than expected, and Botanee’s single-brand risk could be exposed further given a full-fledged closequarters competition among brands; 2) herbal-/HA-based functional skincare is incrementally crowded out by the collagen-based. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Botanee Biotech (300957 CH) – Headwinds Endure

Thematic (Sector/Industry)

<ul><li>Our channel checks and various news sources we monitored suggests cosmetic GMV for 6.18 campaign this year stood at a small decline and reached approximately RMB40bn.</li><li>We argue the broad momentum tracked well to expectation, given only a flattish pre-sale (between 25 May and 31 May). By channel, we observed that livestreaming channels continued to draw traffic flow from marketplace platforms, and this looks to be consistent to the trends observed by our internet team.</li><li>For instance, cosmetic GMV on Douyin increased 70% YoY to RMB15bn.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Our channel checks and various news sources we monitored suggests cosmetic GMV for 6.18 campaign this year stood at a small decline and reached approximately RMB40bn.We argue the broad momentum tracked well to expectation, given only a flattish pre-sale (between 25 May and 31 May). By channel, we observed that livestreaming channels continued to draw traffic flow from marketplace platforms, and this looks to be consistent to the trends observed by our internet team.For instance, cosmetic GMV on Douyin increased 70% YoY to RMB15bn.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Cosmetics – Key takeaway from 6.18 cosmetic sales

<ul><li>We untangle the “household excess saving” enigma.</li><li>Instead of a silver bullet, we consider it a status-quo in which consumers are confident enough to spend (or invest) beyond their pre-pandemic budgets by tapping into their savings accumulated during the pandemic, after they first normalize their spending to prepandemic level.</li><li>In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We untangle the “household excess saving” enigma.Instead of a silver bullet, we consider it a status-quo in which consumers are confident enough to spend (or invest) beyond their pre-pandemic budgets by tapping into their savings accumulated during the pandemic, after they first normalize their spending to prepandemic level.In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Consumer – From Reopening to Recovery

<ul><li>We expect encouraging 5.1 travel data. According to various sources and news we monitor, air passenger during the holiday is likely to surpass 9mn persons, tracking approximately 110% of the level we saw in 2019.</li><li>Splitting between domestic and overseas travellers, the former will likely grow by approximately 25%, while, for the latter, the recovery could track up to 30-40% of that in 2019.</li><li>By destination, air ticket booking to Hainan grew by 1.5x, and Hainan represented 93% of the travel destination of domestic trips.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We expect encouraging 5.1 travel data. According to various sources and news we monitor, air passenger during the holiday is likely to surpass 9mn persons, tracking approximately 110% of the level we saw in 2019.Splitting between domestic and overseas travellers, the former will likely grow by approximately 25%, while, for the latter, the recovery could track up to 30-40% of that in 2019.By destination, air ticket booking to Hainan grew by 1.5x, and Hainan represented 93% of the travel destination of domestic trips.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Consumer – Expecting Encouraging Data from the 5.1 Holiday This Year

<ul><li>2023 outlook. Despite a miss in 4Q, we think Botanee is set to recover along with China’s reopening, thanks to its OMO distribution network and an unchallenged R&amp;D franchise that differentiates from peers.</li><li>Our channel check suggested Winona 2M23 sales grew 20%+ on Tmall/ Taobao and 300%+ on Tiktok.</li><li>For its offline business, we still see huge potential to expand from currently 19% to 26% of total revenue by 2024E, when Botanee only penetrates less than 5% of the national drug stores at present.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

2023 outlook. Despite a miss in 4Q, we think Botanee is set to recover along with China’s reopening, thanks to its OMO distribution network and an unchallenged R&amp;D franchise that differentiates from peers.Our channel check suggested Winona 2M23 sales grew 20%+ on Tmall/ Taobao and 300%+ on Tiktok.For its offline business, we still see huge potential to expand from currently 19% to 26% of total revenue by 2024E, when Botanee only penetrates less than 5% of the national drug stores at present.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Botanee Biotech (300957 CH) – ESOP Targets Stabilize Earnings Expectation

China

Yunnan Botanee Bio-Technology Group Co. LTD manufactures and sells skin care and cosmetics. The Company produces masks, toners, hand creams, and other cosmetics. Yunnan Botanee Bio-Technology Group also develops new biology technologies.

Yunnan Botanee Bio-Technology (300957 CH)

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Yunnan Botanee Bio-Technology (300957 CH)

Botanee Biotech (300957 CH) – Headwinds Endure

Botanee made a pronounced come-back year-to-date, reviving Tmall GMV from -59.8% YoY to -6.9% YoY between Jan and Oct, and accelerating its...

CMB International

China Cosmetics – Key takeaway from 6.18 cosmetic sales

Our channel checks and various news sources we monitored suggests cosmetic GMV for 6.18 campaign this year stood at a small decline and reached...

CMB International

China Consumer – From Reopening to Recovery

In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery.

CMB International

China Consumer – Expecting Encouraging Data from the 5.1 Holiday This Year

According to various sources and news we monitor, air passenger during the holiday is likely to surpass 9mn persons, tracking approximately 110% of...

CMB International

Botanee Biotech (300957 CH) – ESOP Targets Stabilize Earnings Expectation

Despite a miss in 4Q, we think Botanee is set to recover along with China’s reopening, thanks to its OMO distribution network and an unchallenged...

CMB International

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