Northeast siblings launch a startup venture, L’Oréal’s foundation enters the fray, Chando makes a second push toward Hong Kong-listed shares, and last year its revenue first surpassed 5 billion yuan.

This article is sourced from Times Finance. Author: Wu Jiamin, Li Qian

                     Image source: TuChong

The Hong Kong IPO market remains active, and Naturland Group has filed a second submission.

Just 5 days after its first IPO application lapsed, Naturland Global Holdings Limited (hereinafter “Naturland Group”) quickly updated its prospectus.

According to data from Frost & Sullivan, based on retail sales in 2024, Naturland Group is the third-largest domestic cosmetics group in China, only behind Proya and Shangmei Shares. On September 29 last year, Naturland submitted its listing prospectus to the Hong Kong Stock Exchange, but it lapsed recently.

On January 5 this year, the China Securities Regulatory Commission issued supplementary requirements for the overseas issuance and listing filing for Naturland Group, covering multiple issues including the evolution of equity interests of the operating entities within China, business qualifications and foreign investment access, the subscription price for Pre-IPO shareholders, the family trust structure, and compliance related to offshore M&A.

Naturland Group was founded in 2001 and is controlled by the Zheng Chunying family. The group currently operates five major cosmetics brands, including the flagship brand Naturland, as well as Pevlyn, Misu, Sun&Summer, and Ji Chuchu; among them, the Naturland brand contributed 95.9%, 95.4% and 95.3% of the group’s total revenue in 2023, 2024 and 2025, respectively.

Gross margin exceeds 70%, with a “Northeast boss” spending 6 billion yuan on marketing over three years

Naturland Group traces its beginnings to a young entrepreneur from within the northeastern state system.

At age 61, Naturland Group founder Zheng Chunying graduated from the School of Economics at Dongbei University of Finance and Economics in 1986 and worked for the Liaoyang City Finance Bureau in Liaoning Province. After 10 years working in a “steel rice bowl” job, in 1996 he chose to resign and start a business.

In 2001, Zheng Chunying moved to Shanghai, started a new business, established Cang Lan Group (the predecessor of Naturland Group), launched two major brands—Misu and Naturland—and tapped into the beauty retail store channel. In 2010, Naturland entered 2,600 department store and supermarket counters. In 2023, the company transformed from a joint-stock system into a limited liability company. In 2024, four controlling shareholders of the company established their respective family trusts.

The prospectus shows that from 2023 to 2025, Naturland Group achieved revenue of RMB 4.44B, RMB 4.6B and RMB 5.32B, respectively. Net profit, meanwhile, saw some fluctuation: RMB 302 million, RMB 190 million and RMB 351 million in the same period, respectively. Among them, the decline in profitability in 2024 was mainly because the company strengthened marketing activities for its products and brands, leading to an increase in sales and marketing costs.

Overall, the beauty and skincare business still exhibits relatively high gross margin characteristics. From 2023 to 2025, Naturland Group’s gross margin rose steadily to 67.5%, 69.4% and 70.6%, respectively. In the same period, its net profit margin was 6.8%, 4.1% and 6.4%, respectively.

Naturland’s most obvious shortcoming is its heavy reliance on a single brand.

In 2025, the flagship brand Naturland generated revenue of RMB 5.07B, up 15.51% year over year, accounting for as much as 95.3% of the company’s total revenue, almost propping up the company’s core base; in 2023–2024, this share was 95.9% and 95.4%, respectively. It has remained at over 95% for three consecutive years.

In fact, Naturland Group has already tried to build a multi-brand layout, launching high-end skincare brand Misu, a youth-oriented brand Sun&Summer, a sensitive-skin care brand Pevlyn, and a baby and children skincare brand Ji Chuchu, among others, covering multiple sub-segments.

However, the prospectus shows that in 2025, revenue from Pevlyn, Misu, Sun&Summer and Ji Chuchu, as well as other brands, totaled RMB 231 million. These subsidiary brands, developed over many years, together accounted for less than 5% of revenue, and most are still in the market cultivation stage, unable to form competitive scale.

By product category, skincare remains the backbone. In 2025, revenue from skincare exceeded RMB 4.57B, accounting for 86% of total revenue. Personal care revenue was RMB 340 million, representing 6.4%. Makeup and other product categories—including men’s care and baby care products—generated revenue of RMB 209 million and RMB 180 million, respectively, accounting for less than 4%.

Heavy marketing and light R&D is a key issue that the capital market focuses on in the cosmetics sector.

In 2025, Naturland Group’s sales and distribution costs were RMB 3.04B, accounting for 57.2% of total revenue. Of this, advertising expenses alone reached RMB 1.66B. From 2023 to 2025, total marketing and promotion expenditures were RMB 6.16B. According to an incomplete count by Times Finance, over the past year Naturland Group has announced five “top-tier” celebrity endorsement representatives in succession.

In 2025, the company’s R&D spending was RMB 106 million, with an R&D expense ratio of 2.09%. In 2023 and 2024, the company’s R&D expense ratio also hovered around 2%, lower than peers Proya and Betainye’s 2.6%–6.07%. Over three years, cumulative R&D spending was RMB 291 million.

Compared with the industry-standard OEM model, Naturland Group mainly relies on its own plants for in-house production. More than 80% of finished products are produced internally, while an average of 10% and 2% are produced by ODM and OEM suppliers, respectively.

On pricing: according to Naturland’s official Taobao flagship store, most skincare series are priced in the RMB 150–300 range. However, according to the prospectus, from 2023 to 2025, the company’s average selling prices for skincare, makeup and personal care categories all declined to varying degrees, with average prices for each category generally in the RMB 30–50 range.

The Zheng family’s wealth shrank; it once said, “If there’s enough funding, you don’t have to go public”

As a typical family-controlled company, Naturland Group’s equity is highly concentrated within the Zheng family, which includes Zheng Chunying and her three siblings.

In 2023, Naturland Group’s listing entity was established offshore and registered abroad. It was then held by multiple founders’ BVI companies through equity distribution and transfer. In 2024, the founding family established their respective family trusts. Subsequently, each founder’s BVI company transferred the equity in the offshore listed entity that it held to a direct offshore holding company in exchange for 1% of the附投票权 equity held by each direct offshore holding company, while 99% of the non-voting equity was held by each family trust.

The prospectus shows that prior to the IPO, the Zheng family (through the founder’s BVI company and the family trust structure) collectively held about 87.82% of the voting rights in the Cayman listed entity, making it the controlling shareholder of the company. In 2025, the listing entity also proceeded with a share subdivision.

Industry insiders have pointed out that holding equity through trusts can avoid equity division caused by issues such as marriage changes or inheritance among family members, allowing control to transition smoothly. However, Naturland Group’s past complex transactions involving equity transfers and restructurings have also attracted inquiries from regulators, including the reasonableness of pricing bases, the authenticity of capital contributions, and checks for any transfer of benefits.

Currently, Zheng Chunying serves as CEO, executive director and chairman of Naturland Group. Her younger brothers, Zheng Chunbin and Zheng Chunwei, serve as executive directors, and her sister Zheng Xiaodan serves as a non-executive director, but none of them hold specific positions in management.

In addition, the company’s current CFO and board secretary Li Zhuoguang (birth name Li Guangfeng) served as an executive director, vice president, and CFO of Nine Mao Nine (09922.HK) from January 2013 to June 2023, and has also served as an independent non-executive director of Kangchen Pharmaceutical (01681.HK) since February 2025.

In 2023, the company responded to listing rumors by saying, “As long as the funding issue can be resolved, it can remain unlisted.” The prospectus shows that as of February 28, 2026, Naturland Group currently has no borrowings.

From October 2024 to September 2025, Naturland Group introduced Meituan? Meituan? Wait: It introduced Meitian Fund affiliated with L’Oréal, as well as domestic consumer investment institutions Jia Hua Capital, as strategic investors. Among them, Meitian Fund contributed RMB 442 million for a 6.67% stake, while Jia Hua Capital contributed RMB 300 million for a 4.20% stake; together, they raised RMB 742 million.

The “2026 Hurun Global Rich List” shows that Zheng Chunying ranks 3635th on the list with personal wealth of RMB 7.5 billion, down by more than RMB 3.0 billion from RMB 11 billion in 2025.

The mass cosmetics sector is still expanding. The prospectus shows that the market size of mass cosmetics priced below RMB 300 in China is expected to grow from 2025 to 2029 at a CAGR of 7.7%. By 2029, the market size will reach RMB 1,054.8 billion, with its share increasing to 81.9%.

Also, according to Euromonitor data, Naturland’s market share in China’s skincare market declined from 3.1% in 2018 to 2.3% in 2023.

In an environment where domestic brands have risen in succession, foreign brands face intense competition, and consumers are increasingly value-for-money oriented, the company’s brand competitiveness remains under pressure. According to the prospectus, the purposes of Naturland Group’s IPO fundraising in this second attempt include strengthening the company’s DTC capabilities for sales channels, enriching its multi-brand matrix, R&D and product development, and expanding its overseas-market business, among other items.