#Record My 2024#In the Chinese makeup market, Mao Geping can be said to be a newly rising Internet celebrity company in recent years, and its popularity is quite explosive, but just recently, Mao Geping, who was once called "the first domestic makeup stock" by the capital market, suddenly withdrew its listing application.
1. The first domestic makeup stock suddenly withdrew its listing application?
According to the 21st Century Business Herald, after a long wait of 7 years, the listing of the domestic beauty brand Mao Geping finally failed.
According to the disclosure documents on the official website of the Shanghai Stock Exchange, a few days ago, Mao Geping Cosmetics Co., Ltd. (hereinafter referred to as "Mao Geping") applied to the Shanghai Stock Exchange to withdraw the initial public offering and listing application documents on the main board, and in accordance with the relevant provisions of Article 63 of the "Shanghai Stock Exchange Stock Issuance and Listing Review Rules", the Shanghai Stock Exchange decided to terminate the review of Mao Geping's issuance and listing.
According to the 21st Century Business Herald, as early as December 2016, Mao Geping submitted a prospectus for the first time, intending to apply for listing on the main board of the Shanghai Stock Exchange and start the journey of A-share IPO. In September 2017, the status of Mao Geping's IPO materials was changed from "suspended review" to "pre-disclosure update", and since then, his IPO process has stalled and has not been updated. It should be pointed out that in October 2021, at the 113th meeting of the 18th Issuance Examination Committee of the China Securities Regulatory Commission in 2021, Mao Geping made his debut and is expected to sprint to "the first domestic makeup stock". However, the company did not wait for the good news of the listing bell, and in March 2023, Mao Geping updated the prospectus and submitted the statement again. In September 2023, the Shanghai Stock Exchange suspended the review of Mao Geping's issuance and listing because the financial information recorded in the application documents for Mao Geping's issuance and listing had expired. Until recently, Mao Geping voluntarily withdrew his IPO application, and after seven years of waiting, his listing journey did not bear fruit.
According to The Paper, Mao Geping Cosmetics Co., Ltd. was established in Hangzhou on July 28, 2000. According to public information, the company's legal representative, Mao Geping, is an iconic figure in the Chinese makeup industry, and has designed makeup for many films, TV and stage plays, among which the most famous masterpiece is Liu Xiaoqing's makeup in the TV series "Wu Zetian".
According to the prospectus, Mao Geping is mainly engaged in the research and development, production, sales and makeup skills training of makeup and skin care products of the two major brands of MAOGEPING and Zhiai Lifelong. The company's cosmetics include two categories: makeup and skin care, including two brands, "MAOGEPING" and "Love for Life", among which the "MAOGEPING" brand is named after the company's founder, Mr. Mao Geping, and is the company's core brand.
From the perspective of overall performance, from 2020 to 2022, Mao Geping achieved revenue of about 882 million yuan, 1.431 billion yuan, and 1.682 billion yuan respectively, with a compound growth rate of 38.11%, and the corresponding net profit attributable to the parent company in the same period was about 198 million yuan, 327 million yuan and 349 million yuan respectively, and also had good profitability. In addition, from 2020 to 2022, Mao Geping's comprehensive gross profit margin was 81.20%, 80.54% and 81.17% respectively, which has always remained at a high level.
Second, what happened to Mao Geping?
In recent years, with the rapid development of China's economy, the cosmetics market has also shown a vigorous development trend. In this market, Mao Geping, as one of the representatives of domestic makeup brands, has always attracted much attention. However, just recently, Mao Geping suddenly withdrew his listing application, a move that made the outside world speculate: What happened to Mao Geping?
First of all, Mao Geping's withdrawal from the listing is also expected. At present, Mao Geping Cosmetics Co., Ltd. has withdrawn its listing application, which is not an isolated incident in the context of the domestic capital market. In recent years, due to factors such as the adjustment of the regulatory environment, changes in market conditions, and the company's own strategic considerations, many companies have indeed chosen to withdraw their applications voluntarily during the IPO process. In particular, as the regulators have different directions for the listing of traditional companies, many traditional companies may re-evaluate the timing and strategy of listing based on the prediction of factors such as the extension of the review cycle and the increase in policy risks.
Secondly, Mao Geping's withdrawal is also an option to stop losses in time. In the current capital market environment, it is not easy for companies to go public. Especially for the cosmetics industry, due to its special industry attributes and regulatory policies, companies need to face many challenges in the listing process. In recent years, the number of listed companies in the domestic cosmetics industry is not large, and many of them have not performed well after listing, and even have problems such as declining performance and plummeting stock prices. Therefore, from this point of view, Mao Geping's withdrawal of the listing application is also expected.
Although Mao Geping's withdrawal of the listing application may have a certain impact on the company's reputation and brand image, it is not a big deal in the long run. In fact, quite a number of A-share companies have opted to list in Hong Kong to reduce risks through the diversification of the capital market. For Mao Geping, who has applied for listing for 7 years, choosing to withdraw the listing application at this time and stop losses in time is also a good choice.
Third, Mao Geping's current problems are actually not many. If we take a closer look at Mao Geping's development, we will find that Mao Geping still has a lot of potential business risks:
First, the market pressure brought about by fierce market competition. In recent years, China's makeup market has developed rapidly, attracting many domestic and foreign brands to participate in the competition. On the one hand, internationally renowned brands such as Estee Lauder and L'Oreal have occupied the high-end share of the market by virtue of their strong brand influence and perfect sales channels; on the other hand, domestic brands such as Perfect Diary and Huaxizi have risen rapidly and seized market share by virtue of their Internet marketing and cost-effective advantages. In the face of fierce market competition, although Mao Geping has a certain brand awareness, it is relatively lagging behind in product innovation and channel expansion, and its market share is squeezed.
The second is the potential risk of relying heavily on personal IP. The success of the Mao Geping brand is largely due to the personal charm and influence of the founder, Mr. Mao Geping. However, this also poses a certain risk to the business. If Mr. Mao Geping is unable to continue to play the core role of the company due to personal reasons, or the brand image is closely linked to Mr. Mao Geping's personal image, then the company will face a double loss of brand value and market share after losing this soul person.
The third is the drawbacks of the family business management model. In Mao Geping's management team, Mao Geping and his family members occupy important positions. Although this family-style management method ensures the stability and cohesion of the enterprise to a certain extent, it may also lead to problems such as closed decision-making and lack of innovation. In addition, family businesses often face the problem of choosing a successor, and if the successor is not competent, it will directly affect the future development of the enterprise.
Fourth, the core competitiveness of the outsourcing production model is lacking. Mao Geping's products are mainly produced using the outsourcing processing model, and he has not established his own cosmetics production facilities. Although this model can reduce production costs and increase flexibility, it also increases the risk of product quality control. If there are problems in the production capacity and quality control of partners, it will have a serious impact on Mao Geping's brand image and market share.
For Mao Geping, the withdrawal of the listing application is not only a re-examination of his business status, but also an in-depth reflection on his future development strategy. It is not only about the short-term gains and losses at the level of capital operation, but also about how enterprises can maintain their core competitiveness and sustainable growth momentum in the ever-changing market competition.
In the long run, Mao Geping should strengthen his internal skills, including improving product R&D and innovation capabilities, optimizing brand image, strengthening brand diversification, improving internal governance mechanisms, and expanding diversified financing channels, so as to ensure the steady development of the company and lay a solid foundation for the future capital market journey. At the same time, under the new retail format, the use of digital tools and technologies for consumer insight and precision marketing, as well as the layout of online and offline omni-channel sales networks, will also become an important means for Mao Geping to continue to maintain his leading position in the industry in the future.
Therefore, although the withdrawal of the listing application has a big impact, it is not a big deal, and the key is to see what Mao Geping should do in the future.