Eternal Beauty Holdings Limited: Strategic Positioning and Growth Potential in China's Luxury Fragrance MarketWe believe its core investment rationale is as follows: Core beneficiary of a high-growth industry. Consensus positions China’s perfume market as the fastest-expanding segment in cosmetics, with multiple institutions projecting 9-14% CAGR over the next 4-5 years. This trend is underpinned by the cross-sector expansion of domestic/international beauty and global fashion conglomerates into perfume in recent years. The growth is mainly driven by rising penetration, supported by: 1) Macro: China’s per capita perfume spending lags far behind the Meso: stronger lower-tier city consumption willingness and surging spending on men’s perfume, as well as growing online perfume penetration. 3) Micro: fragrance use scenarios extend to daily life. Eternal ranks the 3rd in China (incl. HK & Macau) in terms of retail sales in 2023.