Annual Report on the Tissue and Hygiene Products Industry

CICC Securities Research Report stated that the adult incontinence product market is still in its infancy, showing a high growth trend. From 2015 to 2020, the market size of adult incontinence products in my country increased from 1.98 billion yuan to 6.12 billion yuan, with a CAGR of 25.3%. In 2019, the penetration rate of adult incontinence products in my country was 3%, far lower than the 80% of neighboring Japan, and the world average level has also reached 12%, with great room for improvement. With the acceleration of the aging trend and the upgrading of consumers' health care concept, the penetration rate and product structure of adult incontinence products will be improved, and the industry is expected to maintain a natural growth rate of about 21% compound annual growth rate. In addition, medical insurance policies and social welfare systems will also affect the rate of increase in the penetration rate of adult incontinence products.

On February 21, 2022, the State Council issued the "14th Five-Year Plan for National Aging Development and Elderly Service System", proposing to steadily establish a long-term care insurance system and guide commercial insurance institutions to accelerate research and development suitable for home care, community care, and institutional care. and other products with diversified care needs, etc., to improve the aging performance of adult diapers, nursing pads and other products. The launch of the long-term care insurance system or related commercial insurance is expected to solve the payment problem for adult incontinence products, thereby accelerating the increase in market penetration and the industry is expected to accelerate capacity expansion.

Under the continuous release of national strategic measures to actively respond to the aging population and the general trend of consumption upgrading, the concentration of the domestic adult incontinence products industry will increase, and the market share will be concentrated in leading enterprises with high added value of brands and products such as reliable shares.

Continue to increase market share and maintain a leading position in the industry

The market is optimistic about reliable stocks, in addition to the growth of demand in the general environment, there are also its own internal driving forces. In the research report of CICC Securities, it was mentioned that Reliable Co., Ltd. has deployed offline special channels to expand consumer groups, and online advantageous channels have continued to make efforts. The company first released special channels such as bureau hospitals, nursing homes, and chain pharmacies, and continued to expand consumer groups and increase income while strengthening brand building to achieve a win-win situation with special channels. In terms of online channels, the company continues to expand the number of stores, innovate the way of Internet traffic drainage, and at the same time strengthen digital construction, improve operational service capabilities and efficiency, and consolidate its leading position.

In terms of category development, Reliable Co., Ltd. strives to be high-end, subdivided and comprehensive, and builds the No. 1 brand of pension and well-being. The company founded "Reliable Welfare" in 2015, focusing on the pension and welfare industry, using the O2O model to provide the elderly with products and services in six major areas, including life, nursing, travel, sleep, bathing and health care, and has accumulated rich experience in operation and management. and supplier relations. In terms of self-owned brands, the company continues to enrich user portraits. In 2020, it will launch mid-to-high-end products such as female/male mild incontinence products, which will effectively increase profit margins while enriching categories.

After the IPO of Reliable Shares, it will have more energy and funds, and will invest more resources in Reliable Welfare, opening up long-term growth space for the company.

At the same time, in order to further demonstrate the energetic and positive attitude towards life of the contemporary "new old people", Reliable Shares and China's famous marketing strategy company Hua and Hua Qiangqiang have joined forces to create a super IP of "Reliable and Active Old People". This new upgrade of the reliable brand conveys the new concept of the future trend of old-age care in a dynamic and dynamic image.

From this, it is not difficult to see that Reliable Shares has a firm determination to bring the new concept of pension under the new consumption scene to consumers. The "first brother" in the market often drives the development pattern of the entire industry, and the circle of friends of reliable stock brands will expand again.