Shanghai Jahwa (600315): Personal Care Drives Steady Revenue Growth and Expense Control Drives Net Profit Growth

Shanghai Jahwa (600315): Personal Care Drives Steady Revenue Growth and Expense Control Drives Net Profit Growth

On the evening of the 12th event, the company disclosed its 2018 annual report and realized revenue 71 in real terms.

38 ppm / + 10.

01%, achieving a net profit of 5.

4 billion / + 38.

63%, budget benefit 0.

81 yuan, 2 shares will be allocated for 10 shares.

5 yuan.

Among them, Q4 achieved revenue of 17.

1.8 billion / + 11.

66%, net profit is 0.

8.7 billion / + 42.


Key points of investment: Operating income has grown steadily, and expense control has boosted the growth rate of net profit: quarterly, Shanghai Jahwa’s operating income increased by 10 in each quarter in 2018.

3%, 8.

2%, 10.

0%, 11.

7%, net profit attributable to mothers increased by 35 each year.

9%, 45.

7%, 31.

7%, 42.


In terms of operating income, the company continued to maintain double-digit revenue growth in the fourth quarter, mainly for personal care, and home care products achieved rapid growth.

In terms of net profit, the maximum growth rate was maintained at about 40%. Expense control increased the net interest rate and pushed up gradually the growth rate of net profit.

In terms of categories, personal care products that accounted for 64% of the main income, maintained a steady growth of nearly 13%, driven by brands such as Liushen, Tang Meixing, and Qichu; beauty care brands that accounted for 33% of the main income, were at HerboristUnder the rapid influence of adjustment and the growth rate of some channels, revenue growth of nearly 4% was achieved.

In terms of channels, the company’s online and offline revenue growth is overlapping, and channel adjustments are still ongoing.

In terms of channels, offline channel revenue increased 9% to 55.

At 2苏州夜网论坛6 ppm, online channel revenue increased 13% to 16.

30,000 yuan, caused by the merger of online and offline channel growth.

The gross profit margin of beauty products decreased, and the cost control promoted the increase of profit: In terms of profitability, due to market competition, promotions and higher costs of new factories, the company’s gross profit margin was 64 in 2017.

9% acknowledged 62 in 2018.


Due to good cost control, the long-term sales expense ratio decreased2.

17pct to 40.

65%, management expenses and research and development expenses accounted for revenue decline1.

00pct to 14.

47%, due to the reduction of interest income from the payment of mergers and acquisitions, the financial expense ratio increased slightly, and the overall period expense ratio fell2.

78pct to 56.

0%, covering 杭州桑拿网 the impact of lower gross profit margins and boosting profit growth. The inventory at the end of the year has improved compared with the end of the third quarter, and the inventory scale and asset impairment losses are controllable: in terms of inventory, the company’s inventory balance at the end of 2018 was 8.

7.5 billion.

Driven by e-commerce sales and inventory clearance in the fourth quarter, year-end inventory has improved compared to the end of the third quarter.

The company’s inventory accounted for revenue in 2018 from 11 at the end of 2017.

57% increased to 12.

26%, the inventory scale is relatively large and controllable.

In terms of asset impairment, long-term asset impairment losses amounted to about 60.31 million yuan, accounting for about 0 of revenue.

84%, which is roughly equivalent to that in 2017, and asset impairment losses are basically controllable.

Daily Chemicals has a competitive advantage and is expected to achieve steady growth: In addition to the offline market of the department store channel in 2018, Liushen has continued to occupy nearly 75% of the market share in the toilet water category, ranking first in the market share; Goff ‘s brand male cream market share4th; Qichu brand ranks second in the market in baby creams and baby shower gels.

The average value of the company’s typical daily chemical brands has achieved a higher city share and leading market share in its main categories.

Euromonitor estimates that the compound annual growth rate of the beauty and personal care industry market will be approximately 8 from 2018 to 2022.


The company’s typical daily chemical brands are expected to achieve leading market share and achieve steady growth driven by market expansion.

Beauty care brand Herborist, Meijiajing also performed well in typical categories: in 2018, Herborist maintained 2 in offline department store channels.

5% market share, ranking 12th in terms of market share; the US and Canadian net brands maintained a 12th in the mass hand cream category.

8% market share, ranking first in market share.

The market share of traditional cosmetics is scattered, and the company’s typical brand Herborist still has room for development.

The domestic cosmetics market is becoming less concentrated, and several brands are embracing their development potential: Euromonitor data shows that the cosmetic market CR4 is up from 2011 39.

4% to 35 in 2016.


Consumers are not very sticky to brands and are willing to try new brands, providing other small brands with the opportunity to grow rapidly and overtake corners.

At present, domestic brands have begun to enter the top ten of the domestic cosmetics market. Among the top 10 domestic cosmetics market in 2017, three domestic brands have been selected, including Shanghai Shangmei, Baique Ling and Galan Group.

The market share of the three domestic brands is 7.

1%, with 10 in first place P & G.

1% of total expenditure deviation.

However, from the perspective of changes in the TOP10 brand market share in 2008, 2012, and 2017, domestic brands have made breakthrough progress.

Investment suggestion: Shanghai Jahwa is one of the daily chemical companies with a long history. In 2018, the company’s personal care and home care products led to steady revenue growth, and cost control promoted a rapid increase in net profit.

The company’s daily chemical product category is expected to achieve a steady growth in market leadership and achieve steady growth, and the beauty product category is expected to usher in opportunities for the development of domestic cosmetics brands.

We predict that the company’s annual revenue from 2019 to 2021 will be 0.

96, 1.

20 and 1.

45 yuan.

Return on net assets were 10 respectively.

4%, 11.

9% and 12.

9%. At present, the company’s PE (2019E) is about 33 times.

Risk Warning: 1.

Social consumer goods retail growth has accelerated; 2.

2. The improvement of beauty brand channels such as Herborist remains uncertain; 3.
The influence of overseas brands on the high-end cosmetics market; 4.
The company’s future advertising marketing may drive up the expense ratio.

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