Key Takeaways
Chinese beauty company Chando Global Holdings refiled its application for a Hong Kong initial public offering on April 2, revealing 2025 revenue of ¥5.32 billion.
The filing to the Main Board, with joint sponsors Huatai International and UBS Group, comes just days after its first application from September 2025 lapsed and amid inquiries from the China Securities Regulatory Commission.
The updated prospectus shows gross margin improved to 70.6 percent in 2025, while net profit recovered to ¥3.51 billion after a 37.1 percent decline in 2024. The main Chando (自然堂) brand constitutes 95.3 percent of sales, while research and development spending fell to 1.7 percent of revenue in the first half of 2025.
The IPO’s success will test investor appetite for traditional consumer brands with high marketing costs and will be critical for Chando to fund its expansion against fast-growing rivals like Proya and SEMg.
Chando’s revenue places it as China’s third-largest domestic cosmetics group, but its growth lags competitors. The company’s compound annual growth rate was approximately 3.5 percent from 2022 to 2024, well behind market leader Proya, which has surpassed ¥10 billion in annual revenue, and SEMg at roughly ¥6.8 billion.
The firm’s business model faces scrutiny for its "heavy marketing, light R&D" approach. Sales and marketing expenses consistently exceed 55 percent of revenue, a level higher than peers. In contrast, R&D investment has been shrinking, raising questions about its ability to innovate in a market where consumers are increasingly focused on product efficacy and ingredients.
Regulatory hurdles also present a challenge. The CSRC is formally questioning the company’s red-chip structure, historical equity changes, and pricing differences in pre-IPO funding rounds involving investors like L'Oréal and Carlyle Group.
The offering's valuation will be closely compared to listed peers Proya and SEMg, providing a key benchmark for the sector. First-day trading on the Hong Kong Stock Exchange will deliver the initial verdict on whether investors believe in Chando's ability to diversify its brand portfolio and transition from a marketing-led growth model.
This article is for informational purposes only and does not constitute investment advice.
