Shenwan Hongyuan: The trend of segmentation and effectiveness remains unchanged, and the potential of domestic personal care products is limitless
Shenwan Hongyuan released a research report indicating that the personal care industry is entering a golden period of domestic substitution, with domestic brands having an advantage due to a better understanding of local consumer needs. As consumers' pursuit of quality of life upgrades, the market is showing characteristics of segmentation and personalization, with differentiated positioning seizing opportunities in niche markets. It is expected that by 2026, the market size of the hair care industry will exceed 70 billion yuan, and the market size of facial cleansing products will also reach 49.8 billion yuan. It is recommended to pay attention to companies such as Lafang, CHICMAX, Shanghai Jahwa, and Proya
According to Zhitong Finance APP, Shenwan Hongyuan released a research report stating that the personal care industry, as the second largest sector in the cosmetics market, is entering a golden period of domestic substitution. As consumers upgrade their pursuit of quality of life, the demand for segmentation and personalization is creating new opportunities. Domestic brands have an advantage due to their better understanding of local consumer needs. In the context of international brands dominating the market and the fragmented market share of domestic products, differentiated positioning to capture niche market segments presents opportunities. Recommended stocks include: Lafang (603630.SH), CHICMAX (02145), Shanghai Jahwa (600315.SH), and Proya (603605.SH).
Shenwan Hongyuan's main viewpoints are as follows:
The personal care industry is second only to skincare products in the cosmetics sector and has significant potential for domestic substitution.
Personal care products refer to items used for cleaning and beautifying the skin, body, hair, etc., mainly categorized into bathing, hair care, facial cleansing, and other care products. It is the second largest subcategory in the cosmetics industry and occupies an important position in national life. As consumers' pursuit of quality of life increases, the demand for personal care products continues to upgrade, showing characteristics of segmentation and personalization. Domestic brands have an advantage due to their better understanding of local consumer needs. In the context of international brands dominating the market and the fragmented market share of domestic products, differentiated positioning to capture niche market segments presents opportunities.
Entering the era of comprehensive scalp care, with segmented efficacy, concepts, and ingredients creating Eastern care solutions.
According to Qingyan Intelligence, the annual sales of hair care products in China have been continuously increasing since 2022, reaching 55.9 billion yuan in 2023, a year-on-year increase of 13.4%, showing a stable upward trend. It is expected that by 2026, the hair care market size will exceed 70 billion yuan. In a fast-paced living environment, hair quality and hair loss issues are gaining attention, driving the demand for functional products, with an emphasis on product gentleness.
Facial cleansing and skincare are equally important, and "Cleansing + X" multifunctional products are favored for their convenience.
The facial cleansing category mainly includes facial cleansers, cleansing mousse, cleansing cream, and cleansing liquids (cleansing honey). According to the Qingyan report, the market size of facial cleansing products in China reached 49.8 billion yuan in 2023, and it is expected to reach 52.5 billion yuan by 2026. In addition to basic cleansing functions, moisturizing and oil control effects are gradually gaining attention, and multifunctional products that combine cleansing and makeup removal are beginning to appear in the market. "Cleansing + X" products not only simplify daily skincare steps but also save consumers time and money, leading to increased attention. The efficacy and fragrance attributes of body care have become major selling points. According to Euromonitor, the market size of body care in China will reach 23.4 billion yuan in 2024. According to iiMedia Consulting, efficacy and fragrance are the key concerns of Chinese consumers, with attention rates of 65.80% and 56.3%, respectively, with floral fragrances being the most popular.
The body care market is gently recovering, with seasonal segmentation and emotional care gaining attention.
In the post-pandemic era, as consumers' health awareness increases and the demand for comprehensive personal care broadens, the attention to body care products is rising. According to Mintel, consumers highly recognize the emotional value provided by body care products and have differentiated demands for the efficacy of body care products in winter and summer: summer preferences lean towards whitening and brightening, and refining pores, while winter preferences lean towards hydration, soothing, and maintaining delicacy Risk Warning: Consumer recovery is below expectations, new product sales are below expectations, supply chain and product quality control are below expectations, industry regulation is tightening, and industry competition is fierce
