There are always warriors who can make it through a blizzard.
For example, Giant Biotech (02367), in 2023, when the beauty industry has just breathed a sigh of relief, has run a new acceleration: revenue increased by 49% year-on-year, and net profit attributable to the parent company increased by nearly 45% year-on-year. At the same time, its gross profit margin reached 83.6% and its net profit margin reached 41.2% - surpassing Wuliangye.
借此，金融棒棒糖也观察到，还有不少陕企在“To be or not to be ”的选择中选择了“狂飙突进”。
Growth rate of more than 40%: Giant Bio has entered a "turning period"
Let's start with two notable highlights.
First: outperform the "market".
In 2023, the annual revenue of Juzi Biotech will be 3.524 billion yuan, a year-on-year increase of 49%, and the net profit attributable to the parent company will be 1.452 billion yuan, a year-on-year increase of nearly 45%.
This is its second annual report after listing. On November 4, 2022, Giant Biotech went public in Hong Kong, with an increase of 9.88% on the first day, with a total market value of HK $26.5 billion, becoming the Shaanxi company with the largest market value listed in Hong Kong. (See: "Shaanxi's largest stock market capitalization!Giant Biotech is listed in Hong Kong today!")
We have witnessed this grand occasion and were pleasantly surprised by the "exceeding expectations" of its first annual report: the operating income in 2022 was 2.364 billion yuan, a year-on-year increase of 52.30%, and the net profit attributable to the parent company was 1.002 billion yuan, a year-on-year increase of 21.00%.
From an individual point of view, in 2023, Giant Bio will still maintain a rapid growth of more than 40% in revenue and net profit, and from the perspective of the industry, Giant Bio will far outperform the "market".
Last year, although beauty consumption gradually came out of the trough, it was still in a period of shifting gears and decelerating, and consumer confidence still needs to be restored. According to the National Bureau of Statistics, the total retail sales of cosmetics in China will reach 414.2 billion yuan in 2023, a year-on-year increase of 5.1%, just returning to the growth rate of a decade ago.
Second: "Be physically fit".
The first is continuous profitability: it should be noted that Juzi Biotech has created a net profit of 1.4 billion yuan with less than 600 million yuan in operating costs. In 2023, the gross profit margin of Giant Biotech will reach 83.6% and the net profit margin will reach 41.2%.
The second is low risk: of the nearly 5 billion total assets of Giant Biotech, 2.5 billion are cash. Among the 900 million operating assets, most of them are fixed assets such as plants and equipment. The inventory is 200 million, of which 150 million are manufactured products and 50 million are raw materials. The shelf life of raw materials is 1~2 years, and the shelf life of products is basically more than 2 years.
▲Figure: Changes in revenue and net profit of Giant Biotech from 2019 to 2023
Overall, it was a very good year. As early as 2000, Juzi Bio, which developed "Chinese ingredients", is undoubtedly the leader, and is fortunate to not only step on the "rise of domestic products", but also catch up with the "era of effective skin care": in 2023, there will be more than 3.06 million notes with the label of "ingredients" on Xiaohongshu, and more than 5.42 million notes related to skin care.
Of course, going from 99 to 100 is the hardest.
For example, the middle ground between net profit margin (41.2%) and gross margin (83.6%) can be high selling expenses. From 2019 to 2023, Giant Bio's revenue will be 3.6 times that of the original, and its sales expenses will be 12 times that of the original.
Huge sales expenses can undoubtedly drive the increase in turnover, what is the effect?
Reflected in revenue: The growth rate of 49.0% is already very high, but in 2022, the revenue growth rate of Giant Biotech will be 52.3%. This is the first time that the revenue growth rate of Juzi Biotech has declined in the past five years.
Reflected in market share: From 2019 to 2022, in addition to the functional skin care products market, the market share of Giant Biotech has decreased in the recombinant collagen segment of medical excipients and professional skin care products.
▲Figure: Giant Bio's market share
The feeling of financial lollipop is that the giant creatures that have become the first brother still need to face the challenges of "the overall weak growth rate of the industry" and "the intensification of the involution of the vertical track", which may be a big test that will last for many years.
Multi-point efforts: heavy research and development, strong marketing, large single products
Of course, Giant Creature is confident in how to continue to run well in an already crowded track. And this confidence to outperform the market stems from the following pattern:
1: R&D genetic blessing.
In 2022, Duan Zhiguang, senior vice president of Giant Biotech, said in an interview with Financial Lollipop: "The industrialized preparation technology of this industry is complex, and the core technology is the foundation. In scientific research and innovation, experience is very important, Juzi has not changed the track for 20 years, and 75 patents have become our 'moat', forming barriers, and it is not easy for new entrants to break through in a short period of time. (For details, see "Giant Biotech Passed the Hearing of the Hong Kong Stock Exchange on the 9th: I Listened to a Lesson in "Synthetic Biology")
As of the end of 2023, the number of Giant Biotech patents has grown to 93.
The market also has special expectations and imagination for Giant Biotech: this is a "scientist" company, Duan Zhiguang is a student of Fan Daidi, the founder and chief scientist of Giant Biotech, and Fan Daidi is the first doctor of biochemical engineering in New China.
▲Picture: Fan Daidi in "Ingredient China: The Battle of Raw Materials"
Her resume is legendary: she was admitted to Northwest University at the age of 18 majoring in chemical engineering, at the age of 22 for graduate school, and at the age of 25 for a Ph.D. When Xi'an Juzi Biotech was founded in 2000, 34-year-old Fan Daidi had just been promoted to professor at Northwest University. At the same time, a new type of recombinant collagen was developed for the first time in a laboratory at Northwestern University.
In the series of "Ingredient China: The War of Raw Materials", Fan Daidi told the beginning of his research and development: 3,000 yuan settlement fee, 5,000 yuan scientific research start-up fee, and 40 square meters of laboratory. In the video, Li Jiaqi comes to this laboratory and sees that it is dim and cramped.
In 2023, the R&D expenditure of Juzi Biotech will be 75 million yuan, a year-on-year increase of 70.5%, and the proportion of R&D expenditure in revenue will be 2.1%, an increase of 0.2 percentage points year-on-year.
2: Marketing system blessing.
From the perspective of sales model, there are two main types of Giant Biotech: direct sales and distributors. The former sells through DTC stores on e-commerce platforms and social media platforms, and sells to e-commerce platforms such as JD.com and Vipshop, while the latter sells through pharmacy chains and cosmetics chains, among others.
▲Figure: Giant Bio's revenue by sales channel
Among them, the direct sales channel will generate revenue of 2.45 billion yuan in 2023, accounting for 68.7% of the total revenue from 59.3% in 2022, and the dealer channel will bring in revenue of 1.104 billion yuan, accounting for 31.3% of the total revenue.
It can be seen that online direct sales is still the "big head" of Juzi Bio. However, in November last year, we found that the first standard store of the "Fumei" brand of Giant Biotech was established in Wangfujing, Xi'an, and the offline counters of relatively "heavy assets" began to enter the construction of Giant Bio's diversified marketing system. (See: "Holding 1.5 Billion Cash: Double 11 "Big Brother" Giant Biotech Opens "Offline Business")
3: Powerful single product blessing.
According to the annual report data, Kefumei, a brand of Giant Biotech, achieved revenue of 2.788 billion yuan last year, a year-on-year increase of 72.9%, accounting for 79.1% of the total revenue in 2023.
Giant Bio's cosmetics business has accelerated its growth since 22 years, and in 2023, 618 and Double 11 have both entered the high-base stage, but the two big promotions still doubled more than expected. During the 618 period in 2023, the GMV of Fumei collagen sticks increased by more than 700% year-on-year, ranking TOP1 on Douyin's annual essence list and TOP1 in the JD home care category, and during the Double 11 promotion, the GMV of collagen sticks increased by more than 200% year-on-year, ranking TOP1 in the Tmall facial essence category and TOP1 in JD's home care products. It is a veritable "star item".
In addition, Juzi Biotech also has a "follow-up move": it has reserved 4 recombinant collagen injection products, aiming at the next track of medical aesthetic injection, adding certainty to its growth.
Traverser: 17 Shaanxi enterprises out of the "blizzard"
According to "Cosmetics Watch", in 2023, 1.59 million cosmetics companies will silently "disappear", and more than 30 brands will "leave" dimly. We can see that in the case of the overall "contraction" of the outside world, peers are not in the same interest. The rapid growth of Giant Bio is surprising.
So here comes a new topic, in the current economic downturn cycle, how many Shaanxi enterprises are trying their best to outperform their peers?
▲Figure: The 7 companies marked in thick are the enterprises on the Science and Technology Innovation Board
The conclusion is:
1: Among the 82 listed companies in Shaanxi, 17 have achieved double growth in revenue and net profit, accounting for 21%.
2: There are 7 enterprises on the Science and Technology Innovation Board, accounting for more than 1/3.
For example, the "metal 3D printing" leader Blitt (34.24%, 78.11%), outperformed the global "market": according to the global intelligence agency of the 3D printing industry, Wohlers Associates, the compound growth rate of the global 3D printing industry in the past 10 years has reached 25%, and the global 3D printing market is expected to exceed 85 billion US dollars by 2030.
It is worth mentioning that it also announced the completion of a fixed increase of up to 3 billion yuan in December last year - the largest financing event in the history of China's 3D printing industry. Most of its funds will be invested in the "metal additive manufacturing large-scale intelligent production base project", and a small part will supplement working capital.
3: There are 2 companies with a net profit of more than 1 billion yuan, one is Shaanxi Guotou (1.082 billion yuan) and the other is gold and molybdenum shares (3.01 billion yuan).
We pay special attention to Shaanxi Guotou: according to the previous statistics of financial lollipop, in the annual report data of 52 trust companies that have been released, the overall revenue in 2023 will decline by 11.26%, and the overall net profit will decline by 14.13%, under the background of this environment, Shaanxi Guotou has taken the best record in history: revenue of 2.812 billion yuan, a year-on-year increase of 46.05%, and net profit of 1.082 billion yuan, a year-on-year increase of 29.18%. (For details, see: "The Best Annual Report in the 30 Years of Listing!Shaanxi Guotou's Revenue of 2.8 Billion and Net Profit of Over 1 Billion")
At this point, we want to return to the core question, that is, when the market competition becomes more and more fierce, there are really traversers who can get out of the "blizzard".
From a superficial point of view, they either have core "barriers", or have prepared sufficient "ammunition", or actively explore "new roads", and from a deep point of view, this is a compound interest of "inward exploration". From the perspective of the industry, compared with other industries, hard technology and high-end manufacturing naturally have the choice of "inward exploration", and basically do not fall into the trap of competing for prices.
▲Figure: Hong Kong stocks and Shaanxi enterprises
Return the perspective to Hong Kong stocks again.
We can see that Juzi Biotech still plays the role of Shaanxi's "first brother in Hong Kong stocks". Before the listing of Giant Biotech, we published an article "Goldman Sachs and CICC Lead, 6 Billion Financing Breaks Record!Giant Biotech Launches Listing in Hong Kong", which believes that a serious study of Hong Kong's capital market should still be placed on the table of many Shaanxi reserve enterprises.
This advice still holds true today: when you are doing well, the capital markets will price you right. In the case of the contraction of domestic A-shares, going to Hong Kong stocks is still an option worth considering.