The 720 Xiaomi, BYD, Innolight, China Staples, China Cosmetics & Proya, Korea Industrials, CDMO CRO, MetaX

Equity Research 8 September 2026 | 7:14AM HKT

The 720: Xiaomi, BYD, Innolight, China Staples, China Cosmetics & Proya, Korea Industrials, CDMO/CRO, MetaX

In Focus | Xiaomi Michael Snaith | Xiaomi – SkyNomad launch sees robust initial orders – Buy. We view the robust initial Goldman Sachs (Asia) L.L.C.

locked orders of over 10,000 units within four minutes for the newly launched Caleb Chan | SkyNomad as reinforcing our bullish stance on the model’s sales volume and margins. Goldman Sachs (Asia) L.L.C.

We believe the highly disciplined SKU lineup provides flexibility to defend against future potential competition, and suggest investors watch for further order volume disclosures after October 7. We leave our 2026E and 2027E volume estimates unchanged at 80,000 and 350,000 units, respectively, and keep our EV gross margin estimates unchanged at 19-20% for the same period. We maintain our 12m TP of HK$39. Timothy Zhao

Themes in Play | China Staples, China Cosmetics & Proya, Korea Industrials, China Insurance

China Consumer Staples – Aug check-in and ALC wrap: Cautious 3Q outlook. We maintain a cautious sector outlook for the third quarter, as August checks reveal persistent weak sentiment and weather drags that continue to pressure beer demand, while beverage sales have stabilized with mixed regional performance. Input cost volatility has returned to the spotlight amid rising prices for PET, sugar, and palm oil, though we expect broadly easing selling-expense intensity in the second half as industry competition becomes more rational. We continue to highlight Buy-rated names including Busy Ming, Wanchen, Mengniu, Yili, Tingyi, Yihai, Angel Yeast, Weilong, ChaCha, Moutai, and CR Beer, favoring structural growth opportunities in emerging value retailer channels and resilient dairy demand. Leaf Liu

China Cosmetics – 1H26/2Q26 Wrap and 2H26 Key to Watch. Our 1H/2Q26 review highlights deteriorating online margins alongside more resilient offline channels, with local leaders outperforming the industry average. While we remain conservative on the broader onshore beauty market due to subdued consumer demand, we are turning relatively more constructive on local peers heading into 2H26. We expect local brands to benefit from an easier base, improved efficiency through self-driven in-house livestreaming, a focus on consistent daily sales, and major SKU upgrades. We recently upgraded Proya (603605.SS) to Buy with a 12m TP of Rmb70, and continue to favor Buy-rated Mao Geping, Giant Biogene, and Forest Cabin. Valerie Zhou

Proya Cosmetics – Core Brand Recovery by Product and Channel – Buy. We project 4% year-over-year growth for the core Proya brand in 2H26, driven by strategic SKU

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upgrades like the recent Red Gem Cream 4.0 launch and a healthier, self-controllable channel mix. The company has successfully shifted towards e-shelf and in-house livestreaming, which now represent over 70% of the channel mix, significantly reducing reliance on high-cost KOLs. Furthermore, we believe the core brand is achieving higher-quality online growth and outperforming industry average profitability by actively cutting paid traffic. We look for 2H26 growth acceleration and improved 2027 visibility from its multi-brand portfolio, with a 12m TP of Rmb70. Valerie Zhou

Korea Industrials – Actuators, Missiles, and Electricity. We prefer a balanced exposure to Korea Industrials and AI infrastructure, focusing on robot actuators (Robotis, HL Mando, Hyundai Mobis), missiles (Hanwha Aerospace), and electricity (Hyosung Heavy Industries). Rapid progress in frontier AI models and declining training costs mark a major inflection point for robot deployment…