J.P. Morgan maintains Overweight on Chicmax (2145.HK), with a Dec-26 target price of HK$99.00

Overview

This report is J.P. Morgan's recap of key discussion points on Chicmax (2145.HK) following Global China Summit 2026. The report maintains Overweight, believing that the company's core brand KANS is recovering, emerging brands continue to show strong momentum, and the multi-brand portfolio, R&D capabilities, omnichannel footprint, and brand assets are likely to continue driving market share gains.

Core views

The core views are: first, 2026 operating guidance remains at revenue growth above 15% and net margin of 12-13%; second, KANS's self-operated livestreaming, KOL livestreaming, and investment in emerging channels are expected to help the brand regain visibility; third, the high growth of Newpage and Armiyo validates the company's multi-brand incubation capability; fourth, product upgrades and expansion into new categories will extend the brands' growth curve.

Analysis framework

The report is mainly based on summit discussions, company data, J.P. Morgan estimates, and a DCF valuation framework, combined with brand sales growth, channel recovery, product iteration, gross margin changes, and industry share analysis to assess the company's fundamental trend.

Methodology notes

• Valuation methodsDCF

  Dec-26 target price

  The report uses DCF to derive a target price of HK$99.00, implying 24x 2027E P/E; key assumptions include 8.5% WACC, 3.0% risk-free rate, 6.0% risk premium, 8.9% cost of equity, and a 1.5% terminal growth rate.

• Fundamental trackingMeeting notes

  Key discussion points from Global China Summit 2026

  Through company discussions, the report tracks 2026 guidance, KANS channel recovery, emerging brand growth, product and category expansion, and the impact of cost inflation on gross margin.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Chicmax(2145.HK)

  Core covered name

  Strengths

  Multi-brand portfolio, strong R&D capability, omnichannel presence, benefit from the domestic-brand trend, and KANS's leading position on Douyin.

  Weaknesses

  Overall KANS livestreaming sales declined in January-April due to a high base effect, and the recovery in growth still needs to be validated.

  Comparison

  The company ranks among the top ten domestic cosmetics companies in China and among the top fifteen players in China's overall beauty and personal care market in 2024.

  Risks

  Product quality, inflation, underwhelming new brand incubation, and government regulation.

• KANS

  Core brand

  Strengths

  Self-operated livestreaming returned to positive growth, KOL livestreaming restarted, hero products continue to iterate, and the brand is expanding into categories such as men's care, hair care, body care, color cosmetics, and fragrance.

  Weaknesses

  The previously high base in KOL livestreaming led to pressure on overall livestreaming sales in January-April.

  Comparison

  In 2024, KANS ranked first among cosmetics brands on Douyin, with GMV exceeding Rmb6.5bn.

  Risks

  Brand visibility recovery falling short of expectations, declining channel ROI, or failure of new product iterations.

• Newpage / Armiyo

  Emerging growth brands

  Strengths

  Newpage has expanded into a full-age product line covering ages 0-18, while Armiyo benefits from its mugwort oil positioning and strong repurchase rate, with strong sales performance in January-April.

  Weaknesses

  The high-growth stage places high demands on brand investment, supply chain, and channel execution.

  Comparison

  Newpage targets 50% sales growth in 2026, while Armiyo targets doubling sales in 2026.

  Risks

  A slowdown in new brand incubation, insufficient consumer acceptance, or intensifying competition.

Key data

• 2026 revenue guidance>15% growthThe company maintains this guidance.
• 2026 net margin target12-13%The report says the guidance remains unchanged.
• KANS KOL livestreaming targetabout 10% of 2H GMV contributionDouyin KOL livestreaming resumed in mid-May.
• Newpage January-April sales>50% growthIn line with the target of 50% sales growth in 2026.
• Armiyo January-April salesdoubledIn line with the 2026 target of doubling sales.
• Chicmax 2024 China beauty and personal care market share1.4%According to Euromonitor, retail sales were Rmb7.7bn.
• KANS 2024 Douyin GMV>Rmb6.5bnThe report says KANS was the No.1 cosmetics brand on Douyin.
• Dec-26 target priceHK$99.00DCF valuation, corresponding to 24x 2027E P/E.

Impact & implications

If KANS channel recovery and emerging brand growth materialize, Chicmax's revenue growth, gross margin improvement, and stronger brand assets could support valuation expansion; conversely, if new product incubation, product quality, or regulatory risks deteriorate, the target price and rating may come under pressure.

Risks

• Deterioration in product quality.
• Rising inflation pressure.
• New brand incubation falls short of expectations.
• Changes in government regulation.
• Recovery in growth of the core KANS brand is below expectations.

What to watch

• Whether KANS self-operated and KOL livestreaming GMV contribution in 2H reaches the target of about 10%.
• Whether Newpage and Armiyo continue to deliver on their 2026 growth targets.
• Whether gross margin gradually improves due to better brand mix and product mix.
• The rollout pace and long-term sales potential of the Hello Kitty collaboration and the new brand developed with Cui Yutao.
• Product upgrades, expansion into new categories such as fragrance, and ROI of new channels such as WeChat Channels.