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Evidence of China’s $ 50 billion obsession with cosmetology is nothing more than a “small red book.”
This is an English translation of Xiaohongshu, a beauty-focused e-commerce and social media app popular with young Chinese women, with the hashtag #PreAndPostOp collecting over 290,000 posts. Many of them show off photographs of overhauled jaw lines, plump lips, and reconstructed cheekbones before and after.
However, since the beginning of July, the market value of the country’s three largest listed medical beauty companies has fallen by a third, representing a total loss of over $ 17 billion despite the popularity of beauty treatments.
Changes in investor sentiment, because the Xi Jinping president is trying to re-form the cultural and business landscape of the country, it is counted the day that China’s young people are under the knife in order to pursue the perfection of the face Suggests that there is a possibility “Common prosperity” drive..
Investment bank Citic estimates that China’s aesthetic medicine market will have sales of over RMB 330 billion ($ 51 billion) in 2020. online game — An industry where strict regulations have incinerated the market value of the dominant group in recent months.
Mark Tanner, managing director of marketing firm China Skinny, said:
State media is increasingly criticizing the industry for promoting idolization of appearances and adding to the misery of young people. Already self-conscious About their looks.
In a commentary released Tuesday, the People’s Daily party mouthpiece warned that ads in the cosmetology industry “exceeded regulatory revenue.” The newspaper warned against an ad with photos before and after a Chinese celebrity designed to “attractive consumers,” calling for “without delay the standardized regulation of this lucrative new industry.”
Tanner, a veteran analyst in China’s cosmetology department, said many people in the country are willing to welcome the crackdown on cosmetology. “”[If] Not everyone “looks perfect” so there isn’t much pressure to do the same with the hard-earned savings, “he said.
Investor anxiety grew with health officials’ concerns about the surge in illegal surgery performed by unlicensed clinics, drawing severe counter-evidence from Beijing about “appearance anxiety” and “young-age surgeon clients.”
Last month, the Shanghai and Shenzhen exchanges banned structured debt products related to consumer loans for cosmetics procedures.
Traders looking for the next target for regulators are using So-Young, an app listed on the Nasdaq. With this app, users can evaluate their facial features, plan fine-tuning and find plastic surgeons. So-Young’s short interest ratio to total stock turnover, a measure of betting on companies, has skyrocketed in recent weeks as its inventories fell by more than half this year to record lows.
Block Silvers, Chief Investment Officer of Kaiyuan Capital, said: Silvers Personal consumption China has helped keep cosmetology companies inventories this year, but the latest signal from Beijing “doesn’t signal short-term growth prospects.”
Authorities have also expressed concern about trends in China’s beauty standards. According to So-Young, 25-year-old Korean actress Go Youn-jung is the most popular model of “copy surgery” trying to recreate the characteristics of celebrities. Pre-surgery and post-surgery photographs on men’s social media often show delicate features that resemble Korean and increasingly Chinese idols. Spoil the masculinity of China..
There are also signs of increasing public awareness of the sensitivity of body images. Posts to Weibo, a social network with hashtags such as #DoYouHaveAppearanceAnxiety and #SayNoToAppearanceAnxiety, have been viewed approximately 490 million times and received tens of thousands of responses.
Some Chinese youth welcome industry calculations. “The education industry has been hit hard. [by regulators]Weibo user Camry wrote in a recent post. “Take more proactive measures against the cosmetology industry.”
Regulatory crackdowns could cancel long-standing rapid expansion in the cosmetics industry and disrupt expectations for blockbuster growth. According to online data service provider Qimai Data, So-Young has already been downloaded more than 400 million times in China since its launch in 2014.
Estimates of the value of China’s aesthetic medicine market vary, but industry analysts agree that the sector is growing at a scorching pace that was widely expected to continue. A report released by Deloitte in January predicts that the value of China-approved cosmetology business will exceed RMB 310 billion by 2023, increase by more than 50% from 2020 and more than 10 times from 2012. doing. The industry is projected to be worth more than RMB 1 trillion by 2030.
However, as expectations of regulatory intervention grow, investor concerns have already spread beyond the public market, postponing private funding, which is usually eager to fund cosmetology startups. I am.
“I was looking for it before … A private equity investor focused on China told the Financial Times, but in the face of the looming regulatory backlash, the fund is looking across the industry for its future portfolio. Investors said they decided to “remove it from the equation.”
Reported by Hudson Lockett in Hong Kong, Sherry Fei Ju in Beijing, and Edward White in Seoul
Investors bet China’s cosmetic surgery industry is next on regulators’ hit list Source link Investors bet China’s cosmetic surgery industry is next on regulators’ hit list