Key takeaway

In 2025, the company's revenue was RMB2.45bn, down 18.9% YoY, remaining under pressure. This was mainly due to weak terminal consumer demand for medical aesthetics and intensified market competition for Hearty and regenerative products. 4Q25 revenue fell 9.6% YoY, with the decline narrowing QoQ, mainly benefiting from the volume growth of the new product AestheFill. In 2025, revenue from solution and gel products fell 27.5% and 26.8% YoY respectively. Revenue from freeze-dried powder products was RMB208mn, becoming an important increment. In 2025, the company's net profit attributable to shareholders of the parent company fell 34.1% YoY, mainly due to front-loaded expenses. Looking ahead, the company's endogenous R&D and exogenous M&A are expected to open a new growth curve. In January 2026, the company's botulinum toxin was approved and will contribute new increments in 2026. R&D pipelines such as semaglutide and deoxycholic acid are advancing steadily. In addition, the company completed the acquisition of South Korea's REGEN on April 30, 2025, and consolidated it into the financial statements, which is expected to further enrich the regenerative product matrix. Relying on REGEN's original overseas channels, it is expected to develop overseas business.

Event

The company released its 2025 annual report: In 2025, the company achieved revenue of RMB2.453bn, down 18.94% YoY. Net profit attributable to shareholders of the parent company was RMB1.291bn, down 34.05% YoY. Net profit attributable to shareholders of the parent company after deducting nonrecurring items was RMB1.099bn, down 41.30% YoY. Basic EPS was RMB4.28, down 34.15% YoY. Weighted ROE was 17.01%, down 11.00 pcts YoY.

Quick Take

Medical aesthetics terminal prosperity is weak coupled with intensified competition, the company continued to be under pressure in 2025, and 4Q25 revenue decline narrowed QoQ. In 2025, the company's revenue fell 18.9% YoY. Single-quarter revenue for 1Q25 to 4Q25 was RMB663mn (-17.9% YoY), RMB636mn (- 25.1% YoY), RMB566mn (-21.3% YoY), and RMB588mn (-9.6% YoY) respectively. The YoY revenue decline in the fourth quarter improved QoQ, mainly benefiting from the volume growth of the new product AestheFill from REGEN, which was acquired and consolidated in April 2025. By product, 1) solution injection products: in 2025, the company's revenue was RMB1.265bn, down 27.5% YoY, with a gross margin of 93.1%, down 0.7 pct YoY. 2) Gel injection products: in 2025, revenue was RMB890mn, down 26.8% YoY, with a gross margin of 97.3%, down 0.7 pct YoY. CureWhite was greatly impacted by new products. 3) Freeze-dried powder injection products: in 2025, revenue was RMB208mn, mainly poly-D,L-lactic acid-sodium carboxymethyl cellulose freeze-dried powder, which is the facial filler product AestheFill obtained from the acquired REGEN. The significant revenue decline of traditional main products is mainly due to the product value-added tax rate increasing from 3% to 13% and intensified industry competition.

The company's gross profit margin declined slightly, and the increase in R&D and selling expense dragged down performance. In 2025, the company's net profit attributable to shareholders of the parent company was RMB1.291bn/-34.1% YoY, and the performance pressure was mainly affected by high expense spending. In 2025, the company's gross profit margin was 92.70%/-1.94 pcts YoY, mainly caused by changes in product structure. On the expense side, the company's selling, administrative, R&D, and financial expense rates in 2025 were 15.77%/+6.62 pcts, 7.44%/+3.38 pcts, 14.67%/+4.63 pcts, and 0.31%/+1.34 pcts YoY respectively. The increase in selling expense is mainly due to the increase in labor and advertising expenses. The growth in administrative expense is mainly due to the increase in legal and consulting expenses related to the REGEN M&A. Under the dual impact of revenue decline and expense increase, the company's net profit margin in 2025 was 53.07%/-11.59 pcts YoY.

The R&D pipeline is steadily advancing, and the focus in 2026 will be on the volume growth and internationalization of REGEN AestheFill and botulinum toxin products. On the R&D side, the company continues to strengthen R&D investment. In 3Q25, the minoxidil liniment of Beijing Nuobo, a wholly-owned subsidiary of the company, obtained certification (used to treat male hair loss and alopecia areata). In October 2025, the company completed the filing of its first new cosmetic raw material "licochalcone A". Type A botulinum toxin Hutox obtained certification in January 2026, and the company plans to sign a type A botulinum toxin procurement framework agreement with Huons BP, with the estimated transaction amount in 2026 not exceeding RMB60mn. In addition, the company's second-generation implant thread, medical sodium hyaluronate-hydroxypropyl methylcellulose gel for temporal indications, adapalene and benzoyl peroxide gel, and clindamycin phosphate and benzoyl peroxide gel have entered the registration declaration stage. Deoxycholic acid injection, recombinant human hyaluronidase, and semaglutide are advancing in the clinical trial stage. In terms of external M&A, the company completed the acquisition of a 59.5% equity stake in South Korea's REGEN Biotech (corresponding to an amount of USD190mn) on April 30, 2025, and included it in the consolidated financial statements. REGEN Biotech is a leading regenerative medical aesthetics company in South Korea, with core products including AestheFill (facial) and PowerFill (body), further enriching the regenerative product matrix. Relying on REGEN's original overseas channels, it is expected to expand overseas business.

Earnings forecast:It is estimated that the revenue from 2026 to 2028 will be RMB2.75bn, RMB3.07bn, and RMB3.34bn, +12.3%, +11.4%, and +8.7% YoY respectively. The net profit attributable to shareholders of the parent company will be RMB1.45bn, RMB1.61bn, and RMB1.75bn, +12.6%, +10.8%, and +8.6% YoY respectively, corresponding to PEs of 23.7x, 21.4x, and 19.7x. We maintain "Buy" rating on the company.

Risks: 1) Strengthened medical aesthetics supervision: The company's main products are Class III medical devices, which are licensed products. If national policies on medical device production and operation change, it may affect the company's business plan; 2) Product R&D and registration risks: The company's new product R&D from laboratory research to final approval for marketing and sales generally needs to go through multiple stages such as laboratory research, animal experiments, registration inspection, clinical trials, and registration declaration, which has certain uncertainties, and the company faces product R&D and registration risks. 3) Risk of intensified market competition: The company is a leading provider of innovative medical aesthetics products in China, and has first-mover advantages in the domestic market. In recent years, the demand in the medical aesthetics market has grown rapidly. The industry in which the company operates has a good development prospect, and the average gross profit margin of leading products in the industry is relatively high. This attracts many enterprises to enter the domestic market through independent R&D or mergers and acquisitions. Industry competition will gradually intensify, and the company's operating performance will face the risk of intensified market competition.