Chinese Beauty Brands 2026: Landing On Hong Kong’s Shores

Victoria Harbour in 2026 is witnessing an exceptionally crowded and tense moment in the history of China’s beauty industry. With Lin Qingxuan successfully listed, HBN and Banmu Huadian filing prospectuses, and Proya preparing for a secondary listing in Hong Kong, a clear migration route has emerged: as A‑share IPO channels tighten for consumer companies, the Hong Kong Exchange has become the primary capital gateway for domestic beauty brands.

Beneath the apparent prosperity, however, market dynamics are shifting. Mao Geping’s valuation, trading at more than 30 times earnings, has become a seductive benchmark that risks misleading later entrants into expecting uniformly high premiums for domestic brands. Capital markets, though, remain disciplined and selective. This listing wave is not a celebratory crescendo but the opening of a period of industry differentiation and valuation reassessment. For many domestic brands still queuing to list, the available window may be limited to fewer than 18 months.

The most dangerous misconception today is to treat Mao Geping’s premium multiple as representative of the sector. A review of Mao Geping’s financials shows an unusually high gross margin—above 80%—combined with very low marketing expense ratios, producing a rare and highly profitable business model. That model rests on a dual engine of premium color cosmetics and training services, supported by deep private‑domain customer relationships, which reduces dependence on external traffic acquisition. The market’s willingness to ascribe a high price‑to‑earnings ratio to Mao Geping reflects the scarcity of its high‑margin, high‑cash‑flow, low‑cost structure rather than a blanket endorsement of the entire domestic beauty category. In essence, Mao Geping resembles a luxury or education‑style business more than a mass‑market beauty brand; it is an outlier, not a template.

The dominant theme for Hong Kong‑listed beauty names in 2026 will be valuation reconstruction. Investors will quickly move beyond the broad narrative of a national‑brand renaissance and return to rigorous scrutiny of business fundamentals. By contrast, HBN and Banmu Huadian operate on a conventional mass‑market model that relies heavily on marketing investment to scale. Hong Kong investors can look to comparable listings such as Shangmei Co. for reference, but that does not preclude opportunity for HBN. Debate over HBN’s 57.6% marketing expense ratio often focuses on the headline figure without recognizing the industry context: in a market beset by global incumbents, intense competition and rising traffic costs, marketing ratios near 50% are frequently the necessary price of entry for emerging brands seeking shelf space and consumer mindshare. HBN’s prospectus, however, reveals a different story beneath the surface: modest revenue growth in 2024 and the first nine months of 2025 was accompanied by outsized net profit expansion—net profit rose far faster than revenue—while gross margins remained above 70%. That combination indicates the company can sustain heavy investment while converting traffic into repeat purchases and higher customer lifetime value, thereby unlocking operating leverage. Hong Kong investors will not pay for scale alone; they will reward the ability to convert marketing spend into durable retention and net profit. HBN’s post‑listing imperative is to demonstrate that the same level of investment yields superior brand premium and lifetime value relative to peers.

Liquidity dynamics in Hong Kong create an urgent timing constraint for domestic beauty issuers. The market exhibits pronounced liquidity polarization: leading names attract the bulk of capital, while mid‑tier issuers can quickly become low‑turnover stocks. As Proya and other large groups prepare Hong Kong listings, capital will be increasingly drawn toward these leaders. Once major issuers complete their H‑share placements and institutional allocation needs are satisfied, liquidity available to mid‑cap brands—those with market values in the RMB 5–10 billion range—may contract sharply. Performance‑related risks compound this pressure. Many brands accelerated sales and promotional activity in 2024–2025 to present stronger listing narratives; if growth softens in late 2026 or 2027, and given Hong Kong’s short‑selling mechanisms, share prices could experience abrupt declines. For brands such as Guyu that remain in A‑share counseling and rely heavily on online channels, the strategic choice is pressing: if A‑share policy remains restrictive in early 2026, pivoting to Hong Kong may be the only viable path to participate in the current capital cycle. The year 2026 represents a final round of competitive positioning: those that list and secure funding before liquidity is absorbed by the leaders will gain resources for M&A and cycle resilience; those that delay risk immediate underperformance or prolonged market neglect.

Listing is only the opening act; deeper competition will intensify after companies begin trading. The sector’s internal contest is evolving from a first phase focused on ingredient concentration to a more advanced phase of structural competition across the full value chain. The central challenge is to break the apparent trade‑off among high growth, high profit and low expense. HBN’s 57.6% and Banmu Huadian’s 47.3% marketing ratios highlight a shared industry pain point: the marginal value of traffic has peaked. Over the next two years, the decisive test will be which brands can reduce marketing ratios below roughly 45% without collapsing revenue, shifting from short‑term traffic capture to sustainable brand compounding. Lin Qingxuan offers a demonstrative case: by concentrating on a premium camellia‑oil positioning and exclusive raw materials, the brand has sustained high gross margins and preserved pricing power without overreliance on top influencers.

As the market moves deeper into ingredient‑led competition and brand differentiation, conventional functional ingredients alone are increasingly insufficient to sustain unique brand narratives. R&D claims often remain marketing copy rather than durable moats. In Hong Kong, where R&D‑centric players such as Giant Biogene command investor attention, a pure brand‑operation story has diminishing valuation appeal. Exclusive raw materials—valued for scarcity, technical exclusivity and demonstrable efficacy—have become the primary bridge between brands and capital markets and a key determinant of valuation premium. Current Hong Kong listings illustrate this logic: Giant Biogene’s recombinant collagen, Lin Qingxuan’s camellia oil, and Kans’s peptide technologies all anchor brand technical identities in proprietary inputs. Brands lacking such proprietary material advantages tend to be evaluated more like contract manufacturers, with valuations aligned to ODM/OEM comparators. International leaders such as L’Oréal have long leveraged patented ingredients and validated efficacy to build technical barriers and brand premiums, achieving superior valuation multiples; this provides a clear benchmark for domestic brands seeking to upgrade.

International expansion is shifting from optional to essential. Proya’s decision to list in Hong Kong reflects not only financing needs but also a strategic push toward globalization. With the domestic market approaching saturation, Southeast Asia, the Middle East and Western markets represent the next growth frontiers. A Hong Kong listing offers access to USD and HKD capital and facilitates overseas acquisitions and global supply‑chain development. In future financial statements, a persistent absence of overseas revenue will increasingly be interpreted as a lack of strategic imagination.

Final Commentary

For beauty brands, listing in Hong Kong places the enterprise under intense transparency. Every marketing dollar’s efficiency, each quarter’s inventory turnover and every R&D investment’s output will be magnified in quarterly reports. The era when doubling GMV alone secured financing is over. In 2026 Hong Kong investors are searching for the next L’Oréal or Estée Lauder in China, not merely the next viral hit. Listing is not a safe harbor but an entry into deeper, colder waters populated by formidable competitors. Only brands that combine disciplined capital allocation, respect for fundamentals and a long‑term orientation will secure the ticket to the next decade. The future of China’s beauty industry will be determined by each genuine technological advance, every successful market deployment and every instance of strategic restraint.