Urban Beauty's e-commerce GMV grew by 175% last year. The sub-brand "Pure Cotton Home" will become a key focus for overseas expansion this year | Financial Report Analysis

Ask AI · Key factors behind Pure Cotton Home Goods’ overseas expansion: what drives success in the Vietnam market?

China Financial Network News (March 28) (Reporter Fu Jing) Urban Beauty (02298.HK) released its 2025 annual report on the evening of March 27. Against the backdrop of a consumer market that is returning to “value for money,” Urban Beauty, based on its positioning of “good but not expensive, national underwear,” has maintained stable performance in its main business of close-to-the-body apparel. It has also offset the revenue decline from its industrial projects and logistics business. In particular, the revenue of its underling brand “Pure Cotton Home Goods” grew by 50% year over year, while its e-commerce GMV also increased by 175% year over year.

According to financial data, last year Urban Beauty achieved operating revenue of RMB 2.954 billion, down 1.86% year over year. Of this, revenue from its core close-to-the-body apparel segment was RMB 2.659 billion, up 4.1% year over year. Meanwhile, its industrial projects and logistics business generated revenue of RMB 295 million, which saw a year-on-year decline. In terms of profit, last year the company’s profit attributable to owners was RMB 123 million, down 2.20% from RMB 126 million in the same period of the previous year; gross profit was RMB 1.382 billion, with a gross margin of 46.8%.

It is understood that the company has three major brands: Urban Beauty, ODeeFen, and Pure Cotton Home Goods. Among them, the revenue share of the main brand “Urban Beauty” is 88%, while the underling brand “Pure Cotton Home Goods” achieved revenue of RMB 150 million, up 50% year over year.

It is understood that last year Pure Cotton Home Goods actively expanded its retail network channels. During the year, the number of stores was about 150, further improving its layout in shopping malls in first- and second-tier cities. At the same time, Pure Cotton Home Goods performed well in the Vietnam market. Pure Cotton Home Goods created pet-friendly shopping scenarios and launched “bestsellers” such as anti-sticky pet hair loungewear and the Shui Guang Ye ammonia cotton series, entering the home living segment.

At a performance exchange meeting, Urban Beauty Chairman Zheng Yaonan introduced that Pure Cotton Home Goods is positioned as a middle-class home lifestyle store. Its core pricing is 200–400 yuan. This year, it will be the company’s key overseas development brand. The company’s target is to expand to 200 stores nationwide and about 8 overseas stores. It requires monthly efficiency of 200,000 yuan per store in terms of unit performance. It does not pursue the speed of opening stores, and instead focuses on store efficiency.

Of note, last year the e-commerce business became the core engine driving Urban Beauty’s performance growth. Full-year GMV reached RMB 4.31 billion, up 175% year over year. The number of online stores exceeded 400, and its rankings on major e-commerce platforms also continued to rise steadily. Data shows that livestreaming by influencers became an important incremental driver of online sales. Annual livestreaming GMV exceeded RMB 1.1 billion, of which influencer livestreaming contributed about RMB 200 million. In 2026, the company has set a target of e-commerce GMV of RMB 7.0 billion.

In addition, Urban Beauty optimized its inventory structure. At the end of 2025, total inventory was RMB 658 million, down RMB 59.752 million year over year. The proportion of new goods increased to 64%, and inventory turnover efficiency improved.

Yesterday, Urban Beauty’s executive director and vice president Zhang Shengfeng also discussed the company’s real-estate disposal plan at the performance meeting: “Originally, the 56,000-square-meter subsidiary building planned to be used as a warehouse. In the fourth quarter of 2025, the board of directors resolved to gradually sell it in 2026. The valuation of this portion is about RMB 200–300 million. Currently, 1/3 has already been sold. In the future, we will, based on market conditions, consider renovating or selling other logistics park assets.”

(China Financial Network reporter Fu Jing)