The Cosmetics Industry That Suffered from COVID-19... When Will Spring Come?

[Asia Economy Reporter Hyunseok Yoo] There is a forecast that the cosmetics industry will hit bottom in the first quarter.

On the 29th, Jomijin, a researcher at NH Investment & Securities, stated, "Due to the impact of the novel coronavirus infection (COVID-19), both domestic and international production and sales have been affected, making a decline in first-quarter performance inevitable." However, she evaluated, "In China, as outdoor and consumer activities are gradually resuming, a recovery trend is expected to appear first centered on sales in China."

In particular, Researcher Cho identified that China is recovering and normalizing from the COVID-19 shock. She said, "About 90% of offline stores in China have resumed operations, and logistics and delivery have almost returned to normal." She emphasized, "While it may take more time for the domestic situation, including duty-free, to recover, considering China's recovery trend, the first quarter is expected to be the lowest point."

She forecasted that ODM companies will record relatively stable performance due to rising preference and competitiveness. On the other hand, brand companies will need more time for recovery in duty-free and pure domestic channels but are expected to gradually improve due to local recovery in China and online transition. She explained, "Although consumer activities have been impacted by COVID-19, this does not indicate a fundamental weakening of individual companies' competitiveness or a decrease in demand." She added, "Growth is expected to be maintained from a mid- to long-term perspective."

This content was produced with the assistance of AI translation services.