(Bloomberg) — The beauty market has become a major wealth creator for China’s female billionaires.
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Fan Daidi, the co-founder and chief scientific officer of Giant Biogene Holding Co., is the latest to join the club — and at least the third woman from the sector in recent years. Her net worth has jumped to $2.6 billion after the maker of facial creams and masks went public in Hong Kong last month, according to the Bloomberg Billionaire Index.
China is no longer the billionaire factory it once was. A weakening economy amid stringent Covid policies and a crackdown on tech and property in President Xi Jinping’s quest for “common prosperity” have erased billions of dollars in wealth in recent years.
But Giant Biogene has managed to buck the trend.
“The overall beauty market in China is still in a fast-growing stage, and Giant Biogene has maintained solid revenue growth over the past two years amid the pandemic,” said Kenny Ng, a strategist at Everbright Securities International in Hong Kong. “In the current volatile market, its position as an industry leader will help it gain better market recognition and enjoy relatively higher premium.”
China’s skincare and treatment market is expected to more than double from last year to 1.2 trillion yuan ($167 billion) in 2027, Giant Biogene said in its listing prospectus.
The sector has enriched female entrepreneurs including Jian Jun of Imeik Technology Development Co. and Bloomage Biotechnology Corp.’s Zhao Yan. Guo Zhenyu, a Canadian citizen, also became ultra-rich after his Yunnan Botanee Bio-Technology Group Co. listed in Shenzhen in 2021. While shares of the three beauty companies have fallen this year, the trio has a combined fortune of more than $13 billion.
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At Giant Biogene, revenue surged 30% to 1.6 billion yuan last year. Hillhouse Capital and a China International Capital health-care fund are among its backers.
Fan, 56, owns almost 59% of Giant Biogene. Her husband, Yan Jianya, the other co-founder and chairman of the company, also chairs Xi’an Triangle Defense Co. and holds a $55 million stake in the Shenzhen-listed maker of parts for the aerospace and defense industries.
Giant Biogene didn’t respond to requests for comment.
The couple’s rise contrasts with most of their Chinese peers. The nation’s billionaires part of the world’s 500 richest people have lost almost $240 billion combined this year, according to the Bloomberg index. In addition to Xi’s crackdowns, the market for initial public offerings, which at one point produced one billionaire a week in China, has slowed dramatically due to the impact of Covid disruptions, restricting one big source of wealth creation.
Giant Biogene surged after going public, though, and was one of the few Hong Kong listings this year that was still in the green a month after it started trading.
Born in a rural village in the northwestern Shaanxi province, Fan studied chemical engineering in the ancient capital of Xi’an, where she met her husband, before earning a doctorate from Shanghai’s East China University of Science and Technology. After graduating, she returned to her alma mater in Xi’an to lead a team studying collagen, the product that later would become the basis of her company.
Collagen is known for helping repair damaged skin, often during the aging process. The type of collagen Fan has been promoting — recombinant collagen, or “human-like collagen” — is safer and easier to store than the more common animal-derived collagen.
After spending a year as a visiting scholar at the Massachusetts Institute of Technology, Fan returned to China and founded Giant Biogene in 2000. The company acquired a patent for her technology to produce recombinant collagen five years later and began building a factory in Xi’an. It launched its first collagen brand in 2009, making everything from tightening skin masks to repair sprays. Giant Biogene now has more than 100 products from eight major brands and has expanded to areas including medical gels and supplements.
“Collagen is the kind of functional protein that has been widely used,” Liu Zhangming, an analyst at TF Securities wrote in a report on Nov. 29. There is “very promising room to grow.”
–With assistance from Pui Gwen Yeung.
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