Author丨Tianchen Editor丨Not long after Liuzi released the strongest single-quarter financial report in the company's history, MINISO suffered three consecutive declines in stock price, with a cumulative decline of more than 25%. For a time,Speculation about executives** and store expansion falling short of expectations followed.
MINISO first responded that it was not aware of any reasons for the fluctuations, and said that the company's various businesses were operating normally and smoothly, and the financial situation was stable, and there were no major adverse changes. Since then, it has announced that three of the company's executives plan to buy certain shares in the open market in the next month. Not only that, MINISO also urgently held a meeting to confirm that Li Minxin, the company's executive vice president, is indeed in the market and has a retirement plan, but the matter will not have a market impact on the market in terms of volume and price in the short term.
Li Minxin is retiringBut there are still a lot of things to face.
On November 21, MINISO released its financial report for the first quarter of fiscal year 2024 as of the end of September 2023, with record revenue, profit margin and store size. Ye Guofu, founder, chairman and CEO of MINISO, said in the financial report that this was the best quarter so far in the company's history.
However, institutions including Tianfeng**, Zhongtai** and other institutions also pointed out the risks of MINISO: the expansion of stores is less than expected, the risk of overseas operation is intensified, and the expansion of business formats and product iteration are not as expected.
It is carefully found that the growth of MINISO in the domestic market is weak, and the growth of its revenue and net profit is mainly driven by the overseas market, but its essential operating model has not changed, and the risk of overseas markets will naturally intensify.
Since landing on the U.S. stock market in October 2020, the share price of MINISO, which I thought was landed, has fallen by nearly 60% in two years after a short period of time. The return of MINISO to Hong Kong for dual primary listing in July 2022 should have been a new starting point, but for more than a year, there is still a big gap from the plan of Ye Guofu in September 2018 to realize the "100 billion stores in 100 billion countries" in 2022.
In this way, whether it is the rational comments of ** institutions or the fluctuation of stock prices to provoke investors' sensitive nerves,MINISO still has one foot out of the cliff.
Respond to share price**
On December 5, in the face of three consecutive declines in the stock price, MINISO responded that the company's management confirmed that it was not aware of any information that needed to be publicly disclosed that could cause large fluctuations in stock price and trading volume. At the same time, MINISO said that since the fourth quarter of this year, the company's various business operations have been normal and smoothThe financial position is solid and there have been no material adverse changes.
Since then, MINISO has issued an announcement stating that Zhang Jingjing, the company's chief financial officer and vice president, Huang Zheng, general manager and vice president of MINISO's overseas ** market, and Yao Jianzheng, general manager and vice president of MINISO China operations, plan to purchase a number of shares in the open market in the next month to show their firm confidence in the company's future prospects and long-term development.
At the ** meeting on the evening of the same day, MINISO publicly responded to Executive Vice President Li Minxin**, Li Minxin's latest information on 1 million shares submitted in the U.S. stock market is 144 forms, which means that it is planned to only sell tens of thousands of shares before stopping. It's not uncommon for executives to choose ** shares at some point in their careers for personal planning or financial reasons. As for whether the company's executives have a plan in the future, it still depends on the market to decideHowever, the ** event will not have a market impact on the market in terms of volume and price in the short term.
MINISO said that Li Minxin has a retirement plan and has responded before. In March this year, Li Minxin had 5 **company**, with a total of 12 million shares. On May 16, MINISO announced that Li Minxin resigned as executive director due to age and continued to serve as executive vice president.
In addition to Li Minxin, MINISO also responded to another executive, Dou Na's **, which is a continuation of the earlier collar financing. Under the collar structure, shareholders can lock in a certain percentage of the actual stock price and have the option to buy back the pledge in the investment bank in the future, which is their confidence in the company's long-term holding.
Although MINISO responded to the executives**, this did not quell the speculation in the industry. Because some analysts also believe that in addition to the executives, the sharp drop in the share price of MINISO is also related to the fact that the store scale does not meet expectations.
On November 21, MINISO released its financial report for the first quarter of fiscal year 2024 as of the end of September 2023, with revenue of 379.1 billion yuan, a year-on-year increase of 367%；Adjusted net profit was 64.2 billion yuan, a year-on-year increase of 538%；Gross margin was 418%。
Ye Guofu said that this was the company's best quarter so far, including revenue, profit margin, and the number of net stores opened to a record high. As of the end of September, the number of MINISO stores worldwide exceeded the 6,000 mark for the first time, reaching 6,115. The company has achieved the previously planned net growth target of 350-450 domestic stores for the whole year one quarter ahead of schedule, and expects to open another 100-200 new stores in the 2023 calendar year. At the same time, we will go all out to achieve the net growth target of 350-450 overseas stores for the whole year.
However, a number of ** institutions are also concerned about the risks exposed behind this report card. Tianfeng**, Zhongtai**, and Caitong** all mentioned in the research report that MINISO was less than expected to expand stores and faced transnational policies.
In 2018, Ye Guofu clearly proposed that he planned to achieve the goal of "100 billion stores in 100 countries" in 2022, that is, the group will enter 100 countries and regions, with an annual revenue of 100 billion yuan and 10,000 stores worldwide.
Seeing that 2023 is about to pass, MINISO is still far from this goal. Looking back at the strongest single-quarter financial report in the history of MINISO, it is orThe performance has been not good, orIt is that Ye Guofu's goal of "100 billion stores in 100 countries" is unrealistic.
Domestic income growth peaked
If MINISO still has some time to make up for the risk of expanding the store less than expected, but itsIt is an indisputable fact that domestic business growth has peaked.
In the first quarter of fiscal 2024 ending at the end of September 2023, MINISO's revenue was 379.1 billion yuan, a year-on-year increase of 367%。Among them, the revenue from the Chinese market reached 249.6 billion yuan, a year-on-year increase of 347%。This was mainly due to the year-on-year increase in the average number of MINISO stores in China, which increased by 14% year-on-year, and the average single-store revenue increased by 23% year-on-year8%, driving the revenue of MINISO China's offline stores to increase by 41% year-on-year2%。At the same time, the average number of TOP TOY stores increased by 16 percent year-on-year5%, and the average single-store revenue increased by 25% year-on-year4%, driving TOP TOY's revenue to increase by 46% year-on-year1%。
Revenue from overseas markets reached 129.5 billion yuan, a year-on-year increase of 408%, mainly due to the average number of overseas MINISO stores increased by 12 year-on-year5% and average single-store revenue increased by 25% year-on-year1%。
It is carefully found that since 2023, MINISO has released a total of three fiscal quarterly reports, namely the third quarter of fiscal year 2023 (as of the end of March 2023 and the fourth quarter of fiscal year ending at the end of June 2023) and the first quarter of fiscal year 2024 (as of the end of September 2023), and its revenue in the Chinese market has grown well. 7%。However, it should be pointed out that the year-on-year 2022 is still in the epidemic period, so it is foreseeable that in the second quarter of fiscal 2024 (as of the end of December 2023), MINISO's revenue in the Chinese market will increase significantly.
However, these increases do not tell the whole story, as it can be seen from the four fiscal quarters corresponding to MINISO in 2022 that its revenue in the Chinese market was 1With the exception of the 9% increase, the remaining three quarters were all year-over-year declines. 6%。In contrast, revenue from overseas markets increased during the same period, respectively. 5%。
In fact, the revenue growth rate of MINISO in the Chinese market has been lower than that of overseas markets for two consecutive years. In FY2022 and FY2023, MINISO's revenue in the China market was 74., respectively4.2 billion yuan, 765.1 billion yuan, a year-on-year increase. 8%；Its overseas market revenue was 264.4 billion yuan, 382.2 billion yuan, a year-on-year increase. 6%。
It can be seen,MINISO's revenue growth in the Chinese market has been decliningIn fiscal year 2021, the revenue growth rate of these two markets was 206%、-39.3%。
*Orange Financial Watchmaking.
In terms of revenue share, the Chinese market of MINISO is also declining year by year. From fiscal year 2019 to fiscal year 2023, the proportion of revenue in the Chinese market of MINISO is as follows: 7%；The proportions of revenue from overseas markets are as follows: 3%。
The apparent gap in revenue growth between the two markets is not due to store size. In fact, in recent years, the growth of the number of MINISO stores in China is higher than that of overseas stores. From fiscal year 2020 to 2023, the number of MINISO stores in China will be 2,533, 2,939, 3,226 and 3,604 respectively; The number of overseas stores was 1,689, 1,810, 1,973 and 2,187 respectively. The comparison of the number of growth in the last three fiscal years is: 214.
The real gap comes from differences in operating conditions. In the 2021-2023 fiscal year, the total GMV of MINISO China stores was 1040.6 billion yuan, 10.4 billion yuan, 106$7.1 billion; The total GMV of overseas stores was 48600 million yuan, 641.4 billion yuan, 907.2 billion yuan. The growth rate is significantly different.
It should be noted that the TOP TOY brand launched by MINISO in December 2020 is also classified as a domestic business, but its scale is limited, so it does not contribute much. Q1 FY2024,MINISO's domestic revenue was 230.7 billion yuan, TOP TOY only contributed 1$8.1 billion. As of the end of September 2023, the number of Top Toy stores is only 122.
Zhang Yi, CEO of iiMedia Consulting, said that theoretically speaking, the overall capacity of the Chinese market is still there, but how to adapt to the needs of the market, I am afraid that it needs to increase product innovation. But for now, look,MINISO's product model is more in line with the needs of overseas markets, which has a lot to do with the recent boom of Chinese products going overseas.
Zhuang Shuai, CEO of Bailian Consulting, believes that affected by the low-price competition of e-commerce and the development of discount stores, the domestic market where MINISO is located is already in the stage of stock competition, and the increment is already very small, especially the low-price competition opened by the e-commerce industry has a far-reaching impact on MINISO. MINISO must increase online investment, otherwise the domestic market will shrink further.
Can overseas markets be a lifesaver?
Looking forward to fiscal year 2024, MINISO said that in the face of uncertainty brought about by the macro environment, the company will still focus on long-term strategic goalsWe are committed to globalization, strengthen our product capabilities and further optimize our store network.
In the future, MINISO hopes to participate in global competition from the two dimensions of cost leadership and product differentiation, and continue to produce high-quality IP works with IP design as the feature while always adhering to the basic price of cost performance. At the same time, MINISO will actively try the "super store" strategy, lock in "big beauty", "big toys" and "big IP" to create super categories, and further explore the space for increasing average single-store sales. In addition, in the Chinese market, it will continue to penetrate lower-tier cities to expand coverage.
It can be seen that the overseas market has become the top priority of creating excellent products.
*MINISO official website.
Zhang Shule, the industry's leading person, pointed out that the domestic market has been basically covered under the "10 yuan store" model of MINISO, and the market increment is limited, and the overseas market expansion can continue to use the domestic model to explore. Compared with the two, it is normal for China to become a stock market and its growth rate to be lower, while foreign countries have become incremental markets with a higher natural growth rate.
On the premise of not changing the existing operating model, MINISO can indeed only exchange space for time, so as to have more time and capital to try and error more vertical subdivision of new scenarios. Zhang Shule said.
In terms of IP, MINISO has always been supplemented by cooperation and incubation. As of June 30, 2023, MINISO has established co-branding relationships with 80 IP licensors, including Disney, Barbie, etc. At the same time, it also cooperates with independent artists to develop new IP into trendy IP products.
Consumers in overseas markets have more requirements for the uniqueness and differentiation of brands, so the way of co-branded IP of MINISO is conducive to its products going overseas. In the first- and second-tier cities of the domestic market, co-branded IP also has a very big demand. The demand of the sinking market is not so high, or it depends on the practicality and cost performance of the product. Zhang Yi said to Qingcheng Finance.
Lai Yang, member of the Expert Committee of the China Federation of Commerce and executive vice president of the Beijing Business Economics Association, pointed out that the cost of developing its own IP is very high, and it is not simply to find someone to design it yourself, the investment is very large, and the risk is also very large, so it is unlikely that MINISO will mainly use its own IP in the short term.
Zhang Shule also believes that IP is a cultural product that needs time and content to fill, and it is not realistic to create self-created IP in the short term, and it will only create paper people. The core competitiveness of MINISO is not IP, but cost performance. IP is only an extension, and it is also a possible trial and error for owners of various IPs to explore the low-end market through MINISO, which does not have a key impact on its development at home and abroad.
One thing that has to be mentioned is that since its establishment in 2013, MINISO has mainly relied on stores to win the world, and the proportion of online channels is very small. In FY2023, MINISO's total GMV in China through online channels was 6700 million yuan, down 25%。
In this regard, Zhang Shule said that the physical stores of the 10 yuan store still have differentiated characteristics and have a certain competitiveness with the online scene, which is not inappropriate.
In Zhang Yi's view, this is a feature of MINISO, and the co-branded IP and its main "interest consumption" are in line with the consumption feeling and atmosphere of the store. If it is said that the physical store to win the world means that MINISO's ability to resist risks in the future is relatively weak, then it can expand some competitive products to online channels, which will also become an incremental space.
Lai Yang also believes that the characteristics of MINISO are like this, which is to allow consumers to find their needs in the process of shopping randomly, casually and casually, which is different from placing an online order with a clear purpose. According to Lai Yang's observations,The problem of MINISO is also in the ** chain, although the overseas market is growing, but the product update of some stores is not very timely, and the category is not rich enoughThis is still a bottleneck, how to make overseas stores and domestic stores synchronize with the new, this is the next problem to be solved by MINISO.
But in fact, it is impossible for Ye Guofu to forget the pain caused by e-commerce. Before founding MINISO, Ye Guofu founded the store "Oops" in 2001, which focuses on women's jewelry, and has exploded across the country, but with the popularity of e-commerce, "Oops Yaya" began to show a cliff**.
Nowadays, MINISO seems to be still going against the times and living as an "alternative", but it is still unknown how long it can live in this way, and once the characteristic attributes begin to fail, it may collapse instantly.
Since its establishment in 2013, to its listing on the U.S. stock market in October 2020, and then to its listing on the Hong Kong stock market in July 2022, MINISO has made two leaps from being shy in the bag to having more and the better, but this still cannot complete the goal of "100 billion stores in 100 billion countries" proposed by Ye Guofu in 2018. Judging from the nerves of all parties stirred up by the stock price, MINISO is still very questioned. Perhaps, as Zhang Shule saidMINISO has touched its own development ceiling, which makes the capital market have limited expectations for its future.
In short, one foot of MINISO is still out of the cliff.
end -文 |Tianchen.
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